The beginning of the year is a time when many people begin thinking about estate planning. While it is crucial to have the necessary documents (i.e., wills, trusts, etc.) in place, estate planning provides an excellent opportunity to build upon a lasting legacy. Leaving a legacy is more than passing down material possessions; it is the opportunity to pen living documents that create something more beyond our earthly lives.
In his book, The Treasure Principle, Randy Alcorn says, “You can’t take it with you, but you can send it on ahead.” Your estate plan is a key opportunity to make your mark on the world. What kind of legacy do you want to leave?
Here are a few questions to ask yourself as you consider how to best build upon your legacy through your estate plan.
How well are your children prepared to handle your resources after you are gone?
Estate planning can be a touchy subject to bring up, but it is important to know how your children will manage your estate. It is equally important for your children to understand what will be expected of them. There are two key areas you should look at in determining how well your children are prepared.
Financially, how do they handle the resources which are at their disposal now?
Have you discussed monetary wealth with your family and prepared them for what may be coming their way? Half of all high net worth families have not disclosed their wealth to their children about their wealth, a choice which misses the opportunity to encourage them to think and live generously. While sharing details about your financial situation may be uncomfortable, it is better to prepare the next generation for the responsibility which will be entrusted to them.
Spiritually, do your children live out the values that you want to define your family? For example, they may handle money responsibly – but what will they spend it on when you are gone?
Have you discussed with them the values you hold dear and the causes you care about most? On the other hand, have you invited them to share with you what causes or passionate God has laid on their heart? Use this opportunity to share and uncover what causes members of your family care about most.
What intangible assets do I want to leave to my children?
Estate planning is an opportunity to pass on more than just financial capital. As you build legacy into your estate plan, you also can pass on the social, spiritual, intellectual, and emotional capital of your family. Start the conversation on these topics now with your family.
One idea to integrate your family values into your estate plan is to leave a legacy letter for your family to have when you are gone. This is a non-legal document that allows you the opportunity to speak into the values you want your children to remember, through stories or teachings. It can be a document, a book, or even a video that future generations can reference and continue to learn from. A legacy letter can help tell your story and paint a picture of the future for your heirs.
Should I include generosity in my estate planning?
The idea of an estate plan is to give away everything that you have. So, generosity comes with the territory! But who should be the beneficiaries of this? It can be a complex decision to divide up assets and to keep in mind the impact you want for your family.
One possibility is to set aside an equal portion for giving as you would for your children. For example, if you have four children divide the financial assets five ways and name the fifth “child” as the charity or charities of your choice. This allows you to continue to support the organizations you care about most after you are gone.
Lastly, remember in this whole journey what the purpose of inheritance is. It is not meant to be burdensome or anything but a blessing to your heirs. By putting in the work ahead of time, it is our hope and prayer that your family will thrive for generations!
A good person leaves an inheritance for their children’s children, but a sinner’s wealth is stored up for the righteous.