6 Legacy Planning Questions to Ask Yourself in 2024

With the ever-changing economic and legal landscapes, staying informed about the latest developments in legacy planning is vital. Read on to get your biggest legacy planning questions answered. And if you don’t see your question here, contact our team!

If you have substantial wealth to pass on, creating a comprehensive and tailored legacy plan that will reflect your financial and personal goals is a must. 

Legacy planning is a crucial aspect of wealth management that often gets overlooked until later in life. However, taking the time to consider your legacy goals and how you want to leave a lasting impact on your loved ones - and the causes you care about - can be incredibly rewarding. 

In this blog post, we'll explore six legacy planning questions to help guide your legacy mindset and outline how a wealth preservation specialist can assist you in achieving your goals. Here’s what you need to know.

Legacy Planning vs. Estate Planning

Legacy planning allows you to leave an inheritance that aligns with your values, aids your loved ones, and simplifies the overall wealth transfer process. But what’s the difference between legacy and estate planning

In simpler terms, a legacy embodies "the culmination of your life's efforts." When people use the phrase "everything I have worked so hard for," it encompasses their entire existence. While wealth and possessions are a part of this, they symbolize something deeper. It signifies their achievements in both their professional and personal lives, including their relationships and various accomplishments. 

When someone expresses anger or fear about losing "everything they have worked for," it extends beyond financial concerns. It includes the effort they've invested, the status they've attained through their work, the values they've instilled, the connections they've forged, and more. Most importantly, it often refers to the strong foundation they've laid for the next generation – their children.

Despite the significant benefits of legacy planning, it remains underutilized, with approximately 73% of individuals lacking a plan altogether, often due to uncertainty or time constraints. Now, let's delve into the six essential questions to help you get started.

1. What Are Your Legacy Goals?

Legacy planning begins with a clear understanding of your goals. What do you hope to achieve with the assets and wealth accumulated over your lifetime? Your legacy goals may include providing for your family's financial security, supporting charitable organizations, or leaving a lasting impact on your community.

Reflecting on what truly matters to you and what you want to be remembered for is a crucial first step in legacy planning. Your legacy goals provide the roadmap for the rest of your planning process, helping you make informed decisions about asset distribution, charitable giving, and other aspects of your legacy plan. As you clarify your goals, you'll be better prepared to create a legacy that reflects your values and leaves a meaningful and lasting impact on the world.

2. What Causes Do You Care About Most?

Many individuals have causes, charities, or nonprofit organizations that hold a special place in their hearts. Think about the causes that resonate most and align with your values. Whether supporting education, healthcare, environmental conservation, or any other cause, including charitable giving in your legacy plan, can make a meaningful difference in the world. 

What’s more, giving to charity is also a great way to help maximize your tax deductions, which can save you thousands of dollars.

If you're planning on making a charitable donation this year, understanding the tax strategies related to charitable contributions can help you decide how much to give, what assets to give, and when to give; so you can provide the maximum amount to charity—and receive the maximum tax advantages for yourself.

3. Who Do You Want To Leave Money To?

Identifying the recipients of your financial legacy is a critical step in legacy planning, as it directly shapes the impact your assets will have on the lives of others. Here are some key considerations to help you determine who you want to include in your legacy plan:

  • Immediate Family: Your immediate family, including your spouse, children, and grandchildren, is often the primary focus of legacy planning. You can provide your loved ones financial security, educational opportunities, or a comfortable future.
  • Extended Family: Legacy planning can extend beyond your nuclear family to include extended family members, such as nieces, nephews, or cousins, who may benefit from your financial legacy.
  • Close Friends: Some individuals consider close friends part of their chosen beneficiaries. If you have lifelong friends or people who hold a special place in your heart, leave them a financial gift or support.
  • Charitable Organizations: For those passionate about giving back, legacy planning often includes charitable organizations or causes that align with your values and beliefs. You can leave a lasting impact by supporting nonprofits, foundations, or charitable projects.

When determining who you want to leave money to, it's essential to consider each beneficiary's circumstances and needs. Discussing your intentions with your heirs and beneficiaries can help ensure that your financial legacy serves them meaningfully and practically. By carefully selecting your beneficiaries, you can leave a lasting and positive impact on the lives of those who matter most to you and the causes you care about.

4. How Would You Like Your Heirs To Benefit From An Inheritance?

While leaving an inheritance to your heirs is a common goal, it's essential to consider how your wealth can best benefit them. Do you want to provide financial security, educational opportunities, or a stepping stone to pursue their passions? It's crucial to have open and transparent discussions with your heirs about your intentions. 

By involving them in the planning process and creating a clear roadmap for the distribution of assets, you can help ensure that your legacy aligns with their needs and aspirations. 

Additionally, working with financial professionals can help you structure your inheritance to benefit your heirs while minimizing potential tax and legal complexities. Ultimately, your legacy plan should reflect your desire to provide for your loved ones in a way that enriches their lives and empowers them for the future.

5. What Concerns Do You Have About Leaving An Inheritance?

Legacy planning isn't just about the positive aspects; addressing concerns or potential challenges is essential. Are there tax implications or legal complexities to consider? Are you worried about unequal inheritances? 

Unequal inheritances can occur for various reasons, including family dynamics, personal relationships, and individual circumstances. Data from the University of Michigan's Health and Retirement Study reveals that the proportion of parents over 50 who reported treating their children unequally in their wills increased significantly from 16% to nearly 35% between 1995 and 2010. 

Working closely with a wealth preservation firm like NJM can help make your legacy plan bulletproof. We can help you create a balanced approach that reflects your values and intentions, fostering harmony and understanding among your beneficiaries. Addressing these concerns can help mitigate potential issues and provide a smooth wealth transition.

6. What Does The Perfect Outcome Look Like To You?

Consider your vision of the ideal legacy outcome. What would make you feel satisfied and fulfilled regarding the impact you leave behind? Whether it's seeing your children thrive, knowing your financial contributions have made a difference in a charity you're passionate about, defining your perfect outcome can provide a sense of purpose and direction for your legacy planning. Working alongside a wealth preservation advisor can help set you up for success. 

How a Wealth Preservation Advisor Can Help

Navigating the complexities of legacy planning can be challenging, but you don't have to do it alone. An experienced wealth advisor can play a pivotal role in helping you achieve your legacy goals. Here's how they can assist you:

  • Customized Plans: Wealth advisors work closely with you to develop a customized legacy plan that aligns with your objectives. They can help you structure your assets to maximize their impact and minimize potential tax liabilities.
  • Investment Management: Wealth Preservation specialists can manage your investments to help ensure they align with your legacy goals, whether that involves growing your wealth or generating income for your beneficiaries and charitable causes.
  • Regular Reviews: Legacy planning isn't a one-time task; it requires ongoing evaluation and adjustments as circumstances change. Wealth advisors can regularly review and update your plan to keep it current and effective.

At NJM Wealth Preservation Strategies, we take pride in maintaining high professionalism and integrity in all our interactions. Our advisors can analyze your legacy plan to optimize tax efficiency, potentially minimizing the tax burden on beneficiaries while maximizing the estate's overall value. We can also help you explore strategies such as trusts, charitable giving, and lifetime gifting to achieve your goals while reducing tax liabilities.

Last Thoughts

Legacy planning is a significant component of wealth planning that deserves careful consideration. By asking yourself these crucial questions and seeking the help of an experienced wealth advisor, you can create a meaningful legacy that reflects your values and goals.

Nic J. McLeod is a second-generation Wealth Preservation Specialist with over 20 years of experience. By working with Nic and his team of professionals, you can have confidence, security, and peace of mind, knowing that your financial future is monitored and managed actively and effectively.

You’ve worked hard to ensure that your family’s needs will be taken care of after you’re gone. We promise to uphold your legacy and to guide your family purposefully through accessing and preserving the wealth you’ve built to protect them.

Begin the year by taking proactive steps to plan for your legacy and leave a lasting impact on the world.

Contact us here today to set up your complimentary consultation.