Sitting down with an estate planner to develop an estate plan is a smart first step. But signing your documents is not the end of the process. In order to ensure your wishes and desires are protected, you need to have some frank conversations with your fiduciaries.
We believe that people who live well, should also learn to give well. If you have had success in your life and accumulated wealth in the process, you want to make sure that your loved ones (current and future) will be able to share in your success, even after you’re gone.
But while the fruits of success (money and assets) can be bequeathed, the values that enabled success, as well as the stories along the way, often are simply not addressed in the estate plan.
That’s where a holistic approach to estate planning comes in.
In their seminal book on family giving, “The Cycle of the Gift: Family Wealth and Wisdom”, authors James E. Hughes Jr., Susan E. Massenzio, Keith Whitaker, look beyond the typical tax saving and wealth management implications of estate planning.
With current law allowing over $12 million in estate tax-free giving, there are obvious financial benefits for estates to give to its beneficiaries on a grand scale. But those financial benefits can come at a very high price for the stability of the family.
Financial gifts, especially from high-net-worth estates, once given, can take on a life of their own. The most well-intentioned gift can actually be a negative force for the recipient fueling over-indulgence, loss of values, disruption at work and home, destruction of relationships, and in the worst of cases, complete family breakdowns.
The authors acknowledge that giving to family members raises some serious and thorny questions, the biggest of which is, “How do I prepare recipients for what could very well be a life-changing gift?”
That’s why it’s so important for your estate planner to understand more than just what you have to give, and who you want to give it to.
They need to understand who you are, and what matters most to you.
They need to ask the right questions:
What does a successful distribution look like to you?
What conversations have you already had with your spouse and family?
What issues have already surfaced?
Who will you put in charge?
If you want your estate to be a positive force in the lives of your beneficiaries, this is a necessary and worthwhile process to go through. As Hughes, et al, explain, “giving, if handled correctly, offers a great opportunity to gain deeper insight into recipients as individuals and their needs, and to come to a heightened awareness of your own needs and expectations.”
“A well-managed estate can improve communication within families, strengthen bonds, and promote the well-being and growth of all involved. And, when done well, legacy giving, like a stone dropped into still water, can have a ripple effect that will continue to expand and grow in positive ways.”
A Brief Guide to Giving Well
We see the gift as having two distinct parts…the assets being bequeathed and the packaging that it comes in.
What does the Hallmark card attached to your gift say?
Does it impart guidance and values to the recipient? Does it encourage them to achieve certain goals to receive greater rewards? Is there a personal touch added, such as a favorite memory captured in a photograph?
How do you want the gift to be delivered? How do you want it to be used? What mechanisms and guidance can you put in place for your trustee, so that they can make disbursements that reflect your values and wishes with great confidence?
In the Cycle of the Gift, the authors break this down into three key components:
The Who of Giving―understanding the needs and expectations of all of those most involved in family giving, especially the recipients and givers, including parents, grandparents, spouses, and trustees.
The How of Giving―maintaining the delicate balance between many givers’ needs for control and the recipients’ need for freedom.
The What and Why of Giving―knowing the gift options available to you―from money to business interests to values and rituals―including the authors’ “family bank” concept, a model that combines loans, trusts, and outright gifts and offers a framework and set of practices for long-term family growth.
Teaching the recipient to accept the gift with resiliency.
Receiving money sounds like a blessing. But without context and guardrails, values and guidance, a large gift of money can challenge even the most grounded of individuals.
You want your gift to be a force for good, enabling better life decisions and better outcomes. You want your legacy not just preserved, but actively influencing your beneficiaries for generations to come.
You need a holistic approach to your estate plan.
That’s what we do at Blacksburg Law.
Let us package your gift for you.
At Blacksburg Law, estate planning is more than documents; it’s about the well-being of the family now and for generations to come.
That’s the reason I attended Georgetown’s Institute for Transformational Leadership and obtained my certificate in Leadership Coaching and earned my coaching accreditation through the International Coaching Federation.
These experiences provided me with an even deeper understanding of the complex dynamics of transitioning multi-generational family wealth…and the tools and techniques to empower my clients to embrace their mortality, connect with loved ones and support a smooth transition of wealth and values.
We work together to develop instructions for how your important assets are managed if you’re not managing them, how your vital responsibilities are cared for if you’re not capable, and then how you wish to be remembered when you’re no longer narrating the story.
If you’d like to know more about holistic estate planning, contact us here. You can see our growing list of five-star reviews here.