Pass It On
Have you thought about and planned for your legacy?
“You can’t take it with you.” As much as the ancient Egyptians liked to think so—hence, why pharaohs and wealthier individuals were entombed with some or all of their worldly possessions—the riches accrued in a lifetime will stay here after we have “shuffled off this mortal coil,” as a certain English playwright once wrote.
For those of us who have not labored over such ideas and planned accordingly, professionals who work in the areas of estate planning and wealth management suggest it’s never too late. Putting an estate plan into place is not difficult, but it does require the expertise and attention of capable specialists. Doing so may ensure that one’s final wishes are fulfilled, and future generations are provided for and protected.
Three essential documents—a will, a healthcare power of attorney, and a durable power of attorney—form the basis for a basic estate plan. Of the three, the will and the durable power of attorney speak to matters of legacy, and both can be updated and revised up until the moment of an individual’s death, assuming he or she is of sound mind.
A will outlines how to distribute one’s property and assets after death, who will administer the estate, and, if applicable, who will be the guardian of any minor children left behind. Without a will, the state will determine who receives one’s assets. A durable power of attorney, meanwhile, designates an individual to handle one’s financial affairs in the event that he or she becomes incapacitated or is otherwise unable to manage finances.
Some families have more specific issues to mull over. Parents of adult children with special needs, for example, must prepare for the day when they are no longer around to care for family members who may not be able to provide for themselves. In these cases, a special needs trust may help to improve the quality of life for a dependent, while preserving qualifications for needs-based assistance from the federal government.
David J. Sowerbutts, an attorney with Liebmann Family Law in Newtown, describes a special needs trust as a legal entity based on a fiduciary relationship that exists between a settlor, meaning the person who sets up and funds the trust, and a beneficiary, or the person who will be receiving the assets in the trust. The funds in a special needs trust can be used to pay for any number of things, such as travel, education, and entertainment, as well as medical needs not covered by government assistance.
Entrepreneurs and owners of small businesses have to think about legacy, too—meaning succession planning. Through shareholder and buy-sell agreements, employment agreements, incentive programs for successors, and other vehicles, attorneys such as R. Leonard Davis III of Drake, Hileman & Davis P.C. can help businesses thrive over multiple generations, long after the business’ owner or founder has passed away.
Legacy involves much more than preserving wealth, protecting family, and keeping businesses alive; it’s also about leaving an indelible influence. With the help of a skilled wealth manager, individuals may be able to contribute significant portions of their wealth to a cherished nonprofit or philanthropic cause, without incurring a tax penalty.
Living forever may not be an option, but thinking purposefully about one’s legacy, and then planning accordingly, may be the closest thing to it.
Published (and copyrighted) in Suburban Life magazine, December 2020
