How to plan your personal legacy

Published October 26, 2020, 4:01 PM

by Joe Ferreria

When people ask me what legacies are all about, I would normally respond with a question. I ask them if they still remember the name of their great-, great-, great grandfather?

Chances are, no one could remember his name.

I then explain to them that the reason they cannot, is because their great- great-  great-grandfather never left them any money or did not do anything significant that will make them remember him forever.

This is what legacy planning is all about. It’s answering the question of how people will remember you through the passage of time.

We go through the learning years, prepare for business, a profession, or to work as an employee in an enterprise.

Through our working years, we focus on building a family, buying a home, sending the kids to school, and with hope, accumulating enough for us to have a peaceful and financially stable retirement.

When we step into our senior years, the kids would have gone through school, gotten married, and are starting to have children. They go off and live their own individual lives which leaves you with an empty nest.

Seniors turn to teaching, or doing  social or religious work that impact their community. These are personal activities that do build a positive legacy in the lives of others. Some choose to just continue working and die with their boots on.

For those who have become financially successful in life, the challenge that faces them include how to build a process of distributing wealth to the next generation. You would want your wealth to continue to help others and not destroy the intended beneficiaries. Yes, indeed, money and property can be used for good and can also be mishandled that it ruins your children.

You have to make sure the assets that you give them is something where they can build upon and not dissipate.

For those who have become financially successful in life, the challenge that faces them include how to build a process of distributing wealth to the next generation. You would want your wealth to continue to help others and not destroy the intended beneficiaries.

Doing legacy planning, or estate planning if you must, is not an easy process. It involves making an inventory of what you have and writing down the history of the assets. In the work that I do for people, at times I would come upon a small and seemingly inconsequential part of the estate. When we begin writing down the history of his life, I discover that house was never intended to be sold. It was the first house they built and serves as a reminder of their humble beginnings. So writing things down clarifies why the assets were acquired and what the next generation should do about it.

The next step is assigning assets to beneficiaries. It may be his children, a charitable foundation, a loyal employee. We leave nothing to chance. I examine his relationship with every member of his family. I would build a variety of scenarios and confront him with tough questions about second generation ownership. Because I am a disinterested party to this process, I am able to bring to the surface uncomfortable issues that forces the parent to think hard and confront it. Sure, I had my share of meetings that end in an argument. Nonetheless, it is something that in the end will be good for the planning process.

When you are happy with the plan that you have worked on, the second step is presenting it to the children individually. You will be able to see the reaction, both positive and negative, to the plan. This step allows the benefactor a view of what will happen to the family when the distribution happens upon his death.

Revealing the distribution plan to the beneficiaries is something most people don’t like doing. At times, it erupts into a family argument that results to fractious relationships. I will qualify, however, that while there are cases where the results are negative.  Nine out of 10 families are able to harmoniously live with the distribution intentions of their parents and complete the process without strife.

The final step is to bring the entire family together to talk about the plan and to bring in the professionals in who will be working on the documentation. I like specialists like lawyers who are masters of laws involving the family. We also bring in bankers, accountants, and investment managers who will be part of the execution.

Planning your legacies take time so patience is indeed something you have to factor in the process. Crafting your legacy plan is only the beginning, At the end of every year, it’s good practice to read through what has been prepared and adjust it if there is a need to. A well crafted, deeply thought out plan will make sure that indeed your great- great- grandchildren will remember the life you have lived and your contribution to their own lives. 

 
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