If you follow me on instagram, @pinkfixmymoney, I’ve been hosting LIVEs every Wednesday at 11 am EST. These LIVES have become known as our Legacy LIVES, and touch on topics from the nightmares of estate plans gone wrong to how to get your story into a published best selling book. I love doing these LIVEs, some prepared, some improve, because they help me sort through my own thinking. The same goes for writing these blogs, my books, podcast interviews, the more creative I am, the more I am able to deliver to my audience. I get clear on important topics, I hear other people’s perspectives and insights, and I am able to pull together pillars like what we will dive into today…your Legacy Pillars.
Being a wealth advisor for over a decade, I like to joke that I was born into the industry as my father has been an advisor for 40 years. I’ve sat in on hundreds of estate planning meetings with accountants, attorneys, and advisors. These meetings include people who thought they didn’t even have enough of an estate to think about it all the way up to millions of dollars being inherited. No matter what, YOU have an estate. If you have a bank account, you have an estate. If you own a house, you have an estate. And it is your responsibility to properly plan and protect that estate. If you don’t do it, then who will? The state you live in and the laws that govern it will decide what happens to your house, kids, assets, and this is not something you want to put your family members through. So we will outline the 3 key aspects of any legacy or estate plan now with easy next steps for you to follow and implement. Sound good? Let’s dive in!
- Legal! Every legacy needs some legal documents drawn up by trusted attorneys. We have developed an incredible relationship with a firm that has at least 1-2 attorneys in every state, and they assist our clients in drafting and finalizing wills, power of attorneys, trusts, and deed retitling. It’s a convenient, smooth, and quick process to get some of the best executed agreements I’ve ever read or dealt with. Financial institutions are now requiring financial power of attorneys to be updated every 1-2 years because of all the elder care financial abuse we read about in the news nonstop. When your adult children, once they turn 18, leave for college, having a medical power of attorney on hand will allow their doctors to speak with you if there is an emergency. We are now able to update these documents for our clients and their children with this new partnership. Your personal legacy begins with these critical documents: will, power of attorney, living will, and potentially a trust. Beyond these documents, you will need to review and update your beneficiary designations on your retirement accounts, life insurance policies, annuities, or any other asset that has a beneficiary assigned to it. Now let’s talk about your business legacy! Your business is a separate asset that will also need protection! You will have a continuity plan if you become incapacitated, take a medical leave, say for maternity leave, and who is the key employee who will run the operation during this time? Will they get paid for their services? Beyond your continuity plan, there is the succession plan, if you were to retire or pass away. Who will buy your business, take it over, and continue to build your legacy? There are both legal documents to draft up for your continuity plan and succession plan to have in place.
- To schedule a call with our estate specialist: Camille Ledda, here is her link to get your legal legacy started!
- Now that you have the legal documents set up, who will inherit your assets or take over your business, how will these be funded? On the personal side, your estate will include all your assets from life insurance, your house, bank accounts, retirement accounts, other investments, etc. Take a moment now to reflect on what your biggest asset is: your money or your ability to earn money. What I mean by this is the income means test: is the size of your assets less than or more than 10 years of your income? If it is less, then we will need to build in extra life insurance to help cover your loved ones especially if you have children, a spouse, or parents you take care of. In the case of becoming incapacitated, and you are not medically fit to do your work anymore, disability insurance will come into place and pay you a certain amount every month as a disability benefit. Do you have disability insurance through your work? If you own your business, then you will need to buy a personal disability policy. Whether you pay or your business pays the premium every year will dictate how your benefit is taxed by the federal government. Gain knowledge before you act! On your business side, you will have disability insurance to help fund your continuity plan so you can pay someone to run your business while you receive your disability insurance policy to help pay your personal expenses. In regards to your succession plan, you can have life insurance to help fund the purchase of your business. First you need to get a valuation of your business, future projections of the value, and then get some information on how much life insurance you will need. You can own the policy, the future buyer can own it, or the business can own it and pay the premiums. When you pass away, the new buyer in your succession plan will pay your estate the value of the business with the life insurance proceeds. Without the funding, your legacy will only go so far. If you are like me, and want to create generational wealth from your own legacy, optimizing your funding strategy will be key! (maybe move this to the top of the article)
- If you are ready to explore your funding options, what you already have in place to what you need, insert Jess’s calendar link!
- 70% of wealth is lost from generation to generation. Why? 3 main issues arrive with the passing of inheritance:
- The legal documents weren’t in place, weren’t updated as needed, or weren’t set up properly.
- Family conflict around the estate or your wishes created the need to hire attorneys and waste the estate money with attorney fees, taxes, and the sale of assets quickly!
- Lastly, your money values weren’t passed down to the future generations.
- Here are some questions to help get you reflecting on your money:
- What did it feel like when you made your first six or seven figure salary?
- What did it mean to you when you saved your first dollar, then the $100,000 dollar or $1 mill?
- What does this money represent to you? To your family?
- How do you want this money to impact your children, grandchildren, or even a charity, non-profit, foundation?
- What was the most important reason for saving this amount of money?
- How do you want to be remembered?
- We launched our media productions company, #pinkfix Productions, LLC, to fill a huge void in the financial industry. To have a place for women to tell their story, get their story into the hands of women who desperately need to hear it, and to validate all the work they’ve done over the years. YOU have a story, you have a transformative story, and we are here to help you get your story, your mission out to the masses! We have built our Legacy Launch to fill in this last pillar of your Legacy: Your Story! We are publishing women’s books that are in alignment with our firm’s core values of education for women, overall fulfillment, vulnerability in place of fear, and empowerment! We began this journey of our Legacy Launch by publishing our award winning Creative Director, Ilissa Goman’s book: Now Leaving Numb, and she became a best selling author on the first day of your book launch. Our next step is a collaboration book showcasing 15 of the most innovative women trailblazing a new path for women in the financial industry, called Financial Trendsetters, which will launch in Feb of 2024. We have 4 spots left for women, who are ready to get their story published and become a best selling author.
- If you are ready to begin your book launch, click here to set up a session with Jess!