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wealth transfer basics - blog

3 Wealth Transfer Basics for You and Your Family

In a world filled with so much doubt, finding certainty and security in things you can control is a welcome feeling. That sentiment generally comes from having a plan and the plan being well executed, which makes it surprising that only 26% of high net-worth individuals have a full wealth transfer plan in place. Further, only 54% of those surveyed have a will and 32% have done nothing to prepare at all (according to a recent RBC study on wealth transfer).

This is becoming increasingly relevant as you consider the staggering dollar amount (estimated at $300 trillion) that is set to transfer between generations over the next few decades. With that much money on the line, why is there still so much left unknown for some families? Perhaps it is because the boomers grew up in a time when money was a taboo topic and not discussed, or believe they do not have enough wealth to consider a full wealth transfer plan.

No matter what, it is important to remember that everyone has an estate, no matter how small, and at least the basic documents should be prepared and preparations taken.

How to prepare a basic wealth transfer plan:

1. Create a will

This is arguably the most important thing you can do for yourself and your family. A will is a legally-binding document that allows you to determine how you would like your estate handled upon your death. A will minimizes fights between family members and determines the who, what, and when of your estate. While your estate will still need to go through the probate process even with a will, the will speeds up the process.

Often times, the idea of creating a will is daunting as procrastination and the unwillingness to accept death can hold one back. Remember, your loved ones will appreciate your taking this step to alleviate additional stress in what will already be an emotional and stressful time.

2. Properly title your assets

Just because you have created a will does not mean assets are guaranteed to be distributed as outlined in your will. If you have an incorrectly titled asset, the titling of the asset will outrank your will in terms of importance to the court. There are many different ways to title assets which lead to different distribution methods. Some of the most common include transfer on death (TOD), payable on death, joint tenant, tenants in common, rights of survivorship, revocable trust, irrevocable trust, family trust, etc. It is important to review these titles and ensure you are making the right selection to properly execute your intentions. An estate planning attorney can also help you with these choices.

3. Continue to update your plan

It is suggested that everyone reviews their will and any other wealth transfer plans every 3 to 5 years, or after major life events. We know life changes quickly and as such a will is a living document until the day you pass. This means changes can be made along the way as births, marriages, deaths, or divorce happen. The plan you make at 55 does not have to be the same as 85.

How We Can Help

A plan is subject to change, but you can take the first step by downloading our financial planning questionnaire today. Contact us at 410.685.9685.

Receive your Financial Planning Workbook today!

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wealth transfer basics - blog
Investor Education
Brooke Snyder

3 Wealth Transfer Basics for You and Your Family

In a world filled with so much doubt, finding certainty and security in things you can control is a welcome feeling. That sentiment generally comes from having a plan and the plan being well executed, which makes it surprising that only 26% of high net-worth individuals have a full wealth transfer plan in place. […]

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