There isn’t much grandparents won’t do for their grandchildren.
As financial advisors we are often asked, “How can I help my grandchildren after I’m gone? Can I build a legacy for them that will remind them of me and provide them additional security?”
The grandparents we meet with want their grandchildren to realize their potential. They voice fear that now, more than ever, the world can be a difficult place where costs are high and security seems hard to come by. They realize that while they can share their advice and resources with their grandchildren now, they won’t always be here to help them.
Often, grandparents are not aware of components they can add into their estate plans to create a legacy for their grandchildren and increase their financial security. Without repositioning other assets, the combination of life insurance, a multi-generation trust, and the generation skipping transfer (GST) exemption can potentially create a significant legacy.
Grandparents who want to help their children and grandchildren while possibly reducing estate and generation skipping transfer taxes may enjoy the benefits a multi-generation trust provides. Life insurance can be one of several assets, or the only asset in the trust, and can enhance the trust’s ability to protect and pass on family wealth.
Multi-generation trusts can take advantage of the generation skipping transfer (GST) tax exemption. When properly used, this can potentially help grandparents pass noteworthy sums of money outside the GST tax to benefit younger generations.
Many grandparents find that their lives changed when their grandchildren were born. Their grandchildren helped them see the world differently. Plan to create a legacy that can keep your memory alive in your grandchildren’s hearts for decades to come.
Greg Hammond, CFP®, CPA and Ron Ware, JD are personal legacy advisors and wealth impact strategists who help people grow and preserve wealth, plan for retirement and manage their charitable giving. See how you can build a legacy of your values, influence and money with a Wealth Impact Assessment. Contact Greg at (800) 416-1655 or firstname.lastname@example.org. Contact Ron at (781) 489-9800, or email@example.com.