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Most families think that the only "intergenerational planning" they have to do is estate planning. Estate planning is certainly an important part of intergenerational planning. However, in most instances, estate planning focuses largely on the best way to transfer material assets from one generation to future generations. Nevertheless, the transfer of material assets also carries with it the transfer of values. Implicit in the questions of when assets are transferred, how they are transferred, to whom they are transferred, and what restrictions are built into those transfers are choices and judgments the transferring generation may not mean to make, and may not even recognize, if they and their advisors approach estate planning from a purely economic and tax-driven perspective.
EPIC Wealth Advisors works with the family and their other advisors to ensure that the entire array of intergenerational transfer issues is addressed, and that decisions regarding the transfer of material assets are consistent with values expressed in the family's legacy plan.
Issues that may be considered by a family in this context can be complex. For example, there are a large number of questions that arise if a family begins to think about the value it places on education and how that value might be reflected in their wealth transfer plan: Will there be separate bequests to individual family members or branches to support educational endeavors, or will there be a single trust to support the education of all family members? Will education be supported for as long as a family member wants to stay in school, or only until he or she has received a certain degree or number of degrees? Will trade school or arts education be supported, or only academic and professional programs? If one of the family's assets is a business, are certain kinds of education to be required before a family member enters the business?
Similarly, if a family has a philanthropic mission, what is it and what role is it expected to play in the relationships of future generations? Will there be a single family foundation with a clearly defined mission and a board on which various family branches will be represented? Or, will there be several philanthropic structures in which family members can be involved? Will involvement be voluntary, or will it be required for any family member wanting to receive some other benefit? Are there other criteria of social responsibility the family considers to be important?
Where a family has a significant business asset, issues related to business succession is another important focus for intergenerational planning. What will the family do to prepare future generations for business leadership? Will each generation have a single leader, or will multiple siblings function as an executive team? What about the children and grandchildren who are not interested in the business? Is business ownership to be limited to participants in the business? If not, how will other shareholders be represented?
The issues and questions are a reflection of each family's unique values. EPIC Wealth Advisors works with the family to identify its critical questions and address them in a way that allows the answers to be incorporated into an integrated intergenerational plan that is consistent with the family legacy statement.
Contact us for more information.
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