Building a Legacy for Loved Ones: It is More Than Just Money

“Legacy.” It’s a big word with different meanings for millions of American families. As someone who’s done very well for yourself, we understand how important it is for you to protect your wealth and ensure you can provide a legacy for the future generations of your family.

Maybe “legacy” for you means passing on your values and interests to causes you believe in and providing a solid financial foundation for future generations. You know you want to pass on your wealth to current and future members of your family, but what is the best way to do that? The answer is multi-generational wealth planning.

Building multi-generational wealth is much like constructing a durable, well-designed high-rise to shelter multiple generations of your family. 

Thinking about your estate isn’t just about deciding who gets what after you’re gone. It’s also about making the process smoother for your loved ones after you are gone, maximizing inheritances, and preparing your family members for new responsibilities as the stewards of the wealth you created. 

At Cogent Strategic Wealth, our team of fiduciary financial advisors in metropolitan Chicago specializes in helping successful individuals and their families create personalized estate and multi-generational legacy plans designed around your family’s circumstances, timelines, goals, and values. 

We’re here to make this process as focused and tailored as possible. It pays to get it right the first time.

Laying the Foundation of Your Multi-Generational Estate Plan

Laying a solid foundation for creating a legacy for your family should include strategies such as comprehensive planning, tax mitigation strategies, making the right investment decisions, and avoiding unnecessary risks.

Just as an architect needs a blueprint, managing your wealth needs a comprehensive strategic plan. This includes deciding how to grow your assets using securities, real estate, and business interests, much like choosing the materials and design for the house to ensure it stands the test of time. The same can be said about creating an estate plan. You need a clear vision that includes strategies for asset preservation, tax minimization, or ensuring the seamless transfer of wealth to future generations based on your intent.

Just as a house needs a solid foundation, your estate plan requires a robust legal structure. This might include setting up wills, trusts, powers of attorney, and healthcare directives to ensure your wishes are carried out in the future.

This foundation will guide you in building a legacy that spans generations, enriching your loved ones for increasingly long life spans.

Here are some key components to consider:

• Share your principles like honesty, responsibility, and compassion. Create a set of core values that reflect your family’s core beliefs.

• Build a roadmap for income, expenses, investments, and managing risks. Minimize taxes for your heirs while ensuring assets get distributed as you wish—plan for future education through college funds or trusts.

• Provide opportunities for family members to grow through travel, mentorship, or self-improvement activities. Promote healthy lifestyles and access to good healthcare. Encourage giving back through volunteering or charities.

• Talk openly and respectfully about family finances, values, and goals. Have regular gatherings to discuss matters, fostering connection and shared decision-making. 

• Create a central repository for important documents, plans, and family history. Be open with your heirs to constructively address issues and disagreements.

Watch our founder, Michael Evans, discuss seven important questions you should ask a financial advisor.

Protecting Your Wealth

Once you have the blueprint for your home, the next step is determining the materials you will use for building. Consider how you will protect your home from the elements, such as the type of roof, security systems, etc.

This is similar to how you will preserve your wealth. This could include trusts, tax planning, limited liability companies, and proper insurance coverages designed to safeguard your assets from unforeseen events and risks, much like a house would be built to withstand various elements.

Consider trusts as legal blueprints that allow you to manage your assets during your lifetime and determine their distribution upon the surviving spouse’s passing. Trusts can also assist in reducing estate taxes while also ensuring your beneficiaries receive their inheritance according to your wishes, without the delays caused by probate. 

Effective tax planning can help you utilize tax credits, deductions, and exemptions to minimize your family’s tax liability, allowing you to keep more of your hard-earned money that can be passed to future generations. Like an alarm system in your home, having proper insurance coverage can be a safety net that protects your assets from unexpected events such as accidents, natural disasters, catastrophic illnesses, premature death, or lawsuits. Selecting the right insurance can cover significant financial risks that could otherwise deplete your assets.

Though there are many legal tools to help protect personal assets from predatory litigation, it’s important to first shield assets you own personally from your business activities. The best way to do this is through the use of limited liability companies (LLCs). This strategy can be even more effective though using strategies diversifying your assets by spreading them out across multiple structures and possibly multiple jurisdictions.

Preserve your wealth with a better investing process.

Maintaining and Renovating Your Estate Plan

Once your home is built, regular maintenance is vital to protect its value. There may even come a time when you want to make updates or renovations to the house based on changing needs.

The same can be said about your estate plan. Markets change, economies fluctuate, and personal circumstances evolve. Regular reviews and adjustments of your financial strategies ensure that your wealth continues to serve your family’s needs.

Why Partner with Cogent for Your Estate Planning Needs?

We believe in providing straightforward financial advice based not on financial jargon but on your circumstances and desires. That’s what our Cogent Conversations are all about. We dive deep into your dreams, values, and vision to build a personalized wealth plan that empowers you to live life on your terms.

We know wealth isn’t just about the numbers; it’s your vision for how you see your family’s future. We can help you align your financial choices with what truly matters, building a foundation of trust and independence. You’ll gain the knowledge and tools to navigate your journey confidently and clearly.

We seamlessly integrate cutting-edge tax mitigation strategies, asset protection, and philanthropic planning, ensuring your wealth benefits your loved ones and the causes you care most about for generations. Let us navigate the complexities of wealth management so you can enjoy peace of mind, knowing your family’s future is secure.

For informational and educational purposes only and should not be construed as specific investment, accounting, legal or tax advice. Cogent Strategic Wealth provides investment advice only through individualized interactions. Certain information is based upon third-party data, which may become outdated or otherwise superseded without notice. Third-party information is deemed to be reliable, but its accuracy and completeness cannot be guaranteed. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio nor do indices represent results of actual trading. Information from sources deemed reliable, but its accuracy cannot be guaranteed. Performance is historical and does not guarantee future results. Neither the Securities and Exchange Commission (SEC) nor any other federal or state agency have approved, determined the accuracy, or confirmed the adequacy of this article. © 2024, Cogent Strategic Wealth®