Keys to Preserving Wealth Through Multiple Generations
Many different people are interested in protecting their legacy as well as passing on as much wealth as possible to future generations. According to research, however, many high net worth families have lost their fortunes by the second or the third generation. Up to 70% of a wealthy family’s fortune is typically gone by the third generation and nearly 90% of it is gone by the fourth. This is why it is extremely important to consider preserving wealth through multiple generations with the help of the right estate planning strategies.
Although many high net worth families are taking conservative positions this year, it is important to consider setting up tools that will help individuals let trust and other strategies last as long as possible. Some of the tools that are typically used in this situation include multiple kinds of trusts, a family limited partnership, and an intra-family loan.
The urgency of wills and trusts cannot be overstated for a high net worth family, where it becomes imperative to calculate how much money will be passed on to future generations. Trusts provide a great deal more flexibility and control over your intentions for passing on assets and can also help to shield you from some of the public nature of a will.
Trusts offer more ability for you to outline how a beneficiary will receive the assets. This is ideal for your concerns about a spendthrift child or a beneficiary may need some time and planning to adjust to his or her new assets. Establishing that the trust kicks in at a particular age can encourage children to finish their educational goals as well.
Advanced planning is important for everyone, but especially for high net worth individuals who hope to pass on the wealth and the family legacy for generations to come. Having a relationship with the right Massachusetts estate planning lawyer is important.