Everyone should have an up to date will, trusts that come into effect on death, Lasting Powers of Attorney (LPA) for both finances and health as well as guardians appointed if there are young children. Wills and LPAs should also be in place for any business interests you might have.
Most do not, it is an easy miss in a busy life, but this simple housekeeping can benefit you and your family immensely – simply having your affairs in order is a great comfort to those you might leave behind.
Yours affairs might be complicated. It is crucial you have the right people (trustees, attorneys, executors and guardians) in place. They need to be competent and confident.
But why bother at all?
Because effective estate planning protects your hard-earned wealth for future generations. Who wants their family fortune lost in future divorces or youthful exuberance?
For example, imagine you die, your spouse inherits everything and then remarries. And then divorces a little time later. It is likely that, without proper planning, half your family wealth goes too.
Or, what if your children in their 20s suddenly come into your fortune? How might that effect their behaviour, actions career path and own family life? What will remain for your grandchildren?
This might sound complicated, expensive and laborious but this planning should not be seen as a tiresome expense. Preserving your wealth for future generations requires an investment from you – investing a penny today saves you a pound tomorrow. This is your wealth, your life and your family – the better you protect all three, the sounder you will sleep.
It can happen to the best of them:
Cornelius Vanderbilt (1794–1877) was not, at his death, simply the richest man of his time. He was, by one measurement, the richest American ever to have lived, before or since. His net worth was equal to 5% of the money supply of the United States.
His son William – who inherited most of the estate – essentially doubled it in the next 10 years.
However, within 30 years of the founder’s death, no member of his family was among the richest people in the United States. 48 years after his death, one of his direct descendants died penniless. When 120 of the Commodore’s descendants gathered at Vanderbilt University in 1973 for the first family reunion, there was not one millionaire among them.
Is it worth taking an action or two to mitigate such situations? You have worked hard to create family wealth; we can help future generations keep hold of it.