While the intangible aspects of life are priceless, it’s also important to consider how the material things you leave behind—like your money and other assets—might help increase that influence long after you’re gone. That’s where legacy planning comes in.
By carefully considering your goals, you can design a legacy that incorporates both your wealth and your values to make a meaningful impact on the world and on your loved ones.
In this article, I explore three common strategies for using your wealth to leave a lasting legacy.
What Is Legacy Planning?
Before we start exploring the different ways you can utilize your wealth to leave a lasting legacy, I want to define exactly what legacy planning is.
Legacy planning is deciding how you want to use your assets to make an impact that supports your values. Thinking through your options in advance can help you feel confident that you’ll leave a legacy you can be proud of, one that provides for your loved ones and furthers the causes that are important to you.
You can design a strategy that supports your values and gets you closer to your objectives by utilizing the three techniques described below: trust planning, charitable giving, and impact investing.
Trust Planning
Trusts can serve a variety of purposes and are a useful tool for allocating your resources in a way that supports your legacy. For instance, using a trust can help take care of your loved ones after you’re gone, while also leaving funds to causes you care about.
These kinds of trusts (also known as legacy trusts) cannot be changed after they’re created. Irrevocable trusts like these allow you to possibly lower certain taxes, but some people consider the rigidity a deciding factor.
While it’s not wise to let taxes dictate your entire legacy plan, tax implications should at least be part of your decision-making process. Wealth advisors like our team at Networth Advisors are trained to work with you to determine which trust-planning strategy makes the most sense for your net worth, your goals, and your family.
Charitable Giving
Another useful tool for leaving a meaningful legacy is charitable giving.
Giving to charities is a powerful way to make a lasting impact. You support important organizations that align with your values and simultaneously leave a positive long-term mark on the world and your community. But keep in mind that charitable giving requires careful legacy planning so that your wishes are carried out as intended.
Beyond the material gains, giving to charity can also provide a sense of fulfillment and purpose. It allows you to make connections with people who share your principles and contribute to something larger than yourself.
Impact Investing
A third strategy for effective legacy planning is impact investing.
Impact investing is when you make an investment with the intention of producing a financial return in addition to a beneficial, quantifiable social and environmental impact.
If impact investing is something you want to incorporate into your legacy planning, a professional wealth advisor can help you invest according to your principles with the possibility of also seeing a financial gain.
A wealth advisor’s job is to help you weigh your options and guide you toward a decision that makes the most sense for the goals you have for your unique legacy.
Make the Next Move
As part of your estate plan, you can use the strategies outlined above to verify that your legacy lives on and that your loved ones are taken care of.
Our team at Networth Advisors can work with you to create a legacy planning strategy that aligns with your intended goals. Our goal is for you to feel confident that you have a solid plan in place for the future.
To schedule a meeting, call (800) 822-3639 or email schedule@networthadvisorsllc.com.
