Usually, you can do whatever you like with your money while you’re alive. But what control do you have over your assets when you die? It’s an interesting thought that most people don’t like to dote on, however with more wealth being created through superannuation funds, it’s a thought that will require action at some stage – and the sooner the better.
It has been estimated that members of the baby boomer generation will pass about three trillion dollars to their children or grandchildren over the coming decades. This wealth will in some cases come in the form of family businesses moving to the next generation. In others, it might be more passive investments, such as shares and cash. Astoundingly, more than $407 billion in property is expected to be transferred through inheritance by 2025.
Each of us might only have control over a small piece of this inheritance bonanza. Nonetheless, how much thought have you given to what it will mean to your beneficiaries and how they’ll remember you?
Preparing your legacy
The billionaire US investing guru, Warren Buffett, has some pretty clear views on the legacy he wishes to leave to his children. He has been quoted as saying that he wants to leave them enough money so that they will think they can do anything with their lives, but not so much that they can afford to do nothing.
The first step of course is to determine what assets you have that might form part of your financial legacy. Shares, property, superannuation and life insurance can be treated very differently under estate laws, so it’s crucial to have this checked by your trusted advisers.
Next, you might want to think about the opportunities and values you want to leave to your beneficiaries. Do you want to “rule from the grave”, or let them make their own decisions about how they tackle life’s challenges?
Perhaps other bequests — to charities, for instance — will be your way of reflecting both personal gratitude and your preferred value system.
Who can help?
On the practical side, there are various professionals to help you to create your personal legacy. For example, enlisting a solicitor to draft your will and related documents is crucial. And we can advise you on superannuation and investment matters please contact us on 0415 306 000
It might be a good idea to take time out to reflect on these important issues. Don’t wait until you’re sick or old to plan your legacy. Start now and plan to have the time of your life so you’ll have something memorable to leave behind!
Please call us on 0415 306 000 if you would like to discuss.
Sources:
Musgrave, R. “Values based advice: How to create a living legacy”, Australian Journal of Financial Planning (Volume 3, Number 1, 2008)
www.bankwest.com.au “Bankwest Inherited Housing Report 2010”
www.afr.com “Largest intergenerational wealth transfer to come” (6 December 2017)
Important:
This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business, nor our Licensee takes any responsibility for their action or any service they provide.