If you are a regular reader of this column, perhaps you know I am a staunch advocate of implementing an effective and prudent estate plan.
Frankly, I do not believe my responsibility is complete by just assisting my clients with his or her investments. Instead, I feel it is my obligation to not only manage clients’ money, but also educate them on ways to properly and quickly transfer assets to their loved ones upon their demise, without giving an unnecessary amount of money to the IRS, accountants and attorneys.
I think it is fair to say that when we think of "estate planning," we often think of the material and monetary aspect of distributing one's estate. However, few people think of a different way to leave a legacy to their beneficiaries, such as the gifts of a final love letter or perhaps a recorded message to let their family or friends know how much they are loved. I suggest that your beneficiaries will most likely not remember, nor particularly care which mutual funds or stocks you owned, but they will remember and cherish your final words to them. Of course, it is incredibly easy to procrastinate and assume that you have plenty of time to complete this arguably critical endeavor. Please do not make this essential mistake.
To nudge you in the right direction, I have provided you with a couple of narratives that you might find useful as a basis for your “final love letter.” I received part of the text from an incredibly good read, “A Good Financial Advisor Will Tell You...: Everything You Need To Know About Retirement, Generating Lifetime Income And Planning Your Legacy," by Jeremy A. Kisner, CFP, and Robert J. Luna, CIMA.
Dear children,
If you are reading this letter, I have probably passed away. Please do not be sad. Raising the two of you was my greatest joy, and ultimately, my family is my greatest accomplishment. I am so proud of each of you. I am so happy that I was able to leave some money behind for each of you and for my precious grandchildren. My trust specifies who gets what. In a nutshell, I wanted to split up my assets in such a way that you each get 40 percent of my estate and the other 20 percent gets split equally between my grandchildren. I am not going to tell you what to do with the money I left behind, but I hope each of you will use it to make your life more enjoyable and less stressful. Splitting up the money is relatively easy when it comes to real estate or investment accounts. It was a bit more difficult to figure out who should get which piece of jewelry, art, furniture, my car, etc. There is a list of specific requests with my living trust that indicates who gets what. I tried to guess who would want each item. I need you to know that it was not my intention to favor any one of you, and I tried to make the request as even as possible. The only thing I ask is please do not fight over any of this. I would feel terrible to think that my bequests led to any hard feelings.
Your loving dad…
Dear Wife,
If you are reading this letter, I have probably passed away. I can't believe you outlasted me! Thank you for being my partner in life for the last 60-plus years. I am sure that living without me will be a bit of an adjustment, but I hope you will adjust quickly and get on with life. I hope your next chapter will be filled with new people, new places and more quality time with our kids and grandkids. You were a good wife and good mother. I have organized our financial life so you can pick up right where I left off ... paying bills! All joking aside, you will find our financial inventory statement inside our trust binder with account numbers, user names and passwords, phone numbers and notes. Before you do anything, please meet with our financial advisor, as I have gotten to know him very well over the years and I trust him implicitly. In fact, he was directly responsible in helping me establish an effective and prudent estate plan for your benefit. It may be hard to think about this right now, but maybe one day you will remarry. I want you to know that you have my blessing. My only request is that you keep your money separate and make sure our kids inherit what's left after you join me in heaven. I'll be waiting for you there ... but don't rush.
Your loving husband
Folks, it is never the idea, it is the execution. In other words, I have given you the idea. Now you must execute. The secret to getting ahead is getting started and learning without execution is useless. Momentum is everything! Go get ‘em!
