Intergenerational Wealth Transfer

Many seniors today have benefitted from both the fortunate times they were born in and their own good financial habits.  It didn’t start out this way as most lived in modest homes, many with a single car in the driveway.  Vacations were something that involved a drive into the nearby woods sleeping under something fashioned out of canvas.  A steak dinner or take-out was an event.
The one thing they weren’t likely to have been a beneficiary of until more recently was an inheritance.  Their parents had it far harder than they with little to give except encouragement as they left home in their teens.  If they did receive one chances were in came later in life and didn’t alter their own financial habits.
As a financial planner I delve into the intimate details of people’s money and their goals.  Wealth transfer via estate planning or the gifting of monies is a common topic.  Here are a few considerations based upon experiences I’ve seen or come across.
A little help along the way might be a good route.  Financial gifts of money and education while you are alive allows you the pleasure of seeing these gifts at work.  It also allows you to decide where more help may be required or worthy.
Fair doesn’t necessarily mean equal.  You decide who gets what and how.  There are many financial products under the life insurance umbrella that allow bypass of the estate ensuring privacy.
If your beneficiaries are not very responsible with money now chances are they won’t be any better later.  Providing a lump sum in the hopes that this will change is wishful thinking.  You may structure your affairs so that an income stream is provided over a number of years using an instalment annuity or with the creation of a trust provided your means allow.
Your best intentions and desire to simplify the process can have unanticipated impacts on your estate plan.  Tread very carefully before changing the registration on any of your banking, financial accounts or real estate property.
Mixed marriages and other issues often create unique challenges.  Don’t guess.  Seek the counsel of a lawyer, notary or competent professional as to your options and the best route to accomplish.  Share your wishes with both your executor and your family.
Finally, don’t delay.  It won’t be any easier later.