Guide to inheritance tax planning & passing on wealth - March 2023
Welcome to our Guide to Inheritance Tax Planning and Passing on Wealth. Planning for the future isn’t just about providing for yourself and your family. It’s also about protecting and preserving your legacy, so that your life lessons and values live on.
The saying ‘rags to rags in three generations’ has been used for many years to describe the consequences of wealth-hoarding. The concept is that family wealth does not often survive for more than three generations, with generation one making the money, generation two spending it and generation three seeing none of it.
Some families who are unable to pass down their hard-earned wealth leave each generation needing to start from scratch. This saying serves as an important reminder that while we all need to work hard and aim high, we should also strive to maintain financial security at all times.
Pursuing wealth can be a powerful and life- changing experience, yet the challenges can be significant if it is not properly managed. Most of the focus tends to be on the financial aspect, but eventually our attention shifts to how we can ensure our wealth will last for generations.
Holding on to money and assets through wise investments, appropriate risk management strategies and careful budgeting is essential if we want our family’s future generations to have better opportunities and a secure future.
Creating a successful and sustainable family wealth plan is about more than finances.
To begin, it’s crucial to have an honest understanding of where your family stands across various areas.
Whether you’re just starting to build your family’s wealth or already have a robust portfolio, creating a sustainable plan for the future presents unique challenges.
As part of our work with multi-generational families, we’ve identified three key obstacles that must be addressed:
Establishing an effective estate plan – Planning for the eventual transfer of family wealth requires careful consideration in order to ensure it is accomplished in an efficient and orderly manner while minimising taxes and other liabilities.
Educating children about wealth – Understanding the proper management of money and investments helps children prepare to become successful stewards of their own wealth down the line.
Preparing children to inherit – Today’s environment requires thoughtful guidance around such matters as philanthropy, ownership control, financial decision- making and other important issues related to inheriting large sums of money.
Taking the time to thoughtfully consider these challenges provides families with a roadmap for making sound, prosperous decisions that will guide them through all stages of life. We can design an estate planning strategy that uses trusts, life assurance and investment structures that make the most of the personal allowances and exemptions available.
READY TO DISCUSS YOUR VISION FOR CREATING AND PROTECTING WEALTH FOR FUTURE GENERATIONS?
It’s easy to become overwhelmed by the responsibility of managing family wealth. With our help, you can realise your vision for creating and protecting wealth for future generations. We’ll help you make sure that your family will always be taken care of. To find out more or arrange an appointment, please contact us – we look forward to hearing from you.
TRUSTS ARE A HIGHLY COMPLEX AREA OF FINANCIAL PLANNING.
INFORMATION PROVIDED AND ANY OPINIONS EXPRESSED ARE FOR GENERAL GUIDANCE ONLY AND NOT PERSONAL TO YOUR CIRCUMSTANCES, NOR ARE INTENDED TO PROVIDE SPECIFIC ADVICE.
PROFESSIONAL FINANCIAL ADVICE SHOULD BE OBTAINED BEFORE TAKING ANY ACTION.
THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE TAXATION ADVICE, ESTATE PLANNING, INHERITANCE TAX PLANNING, WILLS OR TRUSTS.