<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=778106407265440&amp;ev=PageView&amp;noscript=1">

How To Turn Your Estate Plan Into A Legacy Plan

by Caldwell Trust

How To Turn Your Estate Plan Into A Legacy Plan

Planning for your financial future can seem like a complicated process - especially when you factor in the many different terms that come up in the conversation. Two particular terms that people may use interchangeably? Estate planning and legacy planning. However, they’re not the same thing.


Here’s a closer look at the difference between estate planning and legacy planning, along with reasons why incorporating the latter into your financial planning process is the best way to comprehensively define the legacy you’ll have after your death.

What is Estate Planning?

Estate planning is the process of creating legal documents that address your wishes upon your death or should you become incapacitated. Rather than leaving your loved ones to guess what you would have wanted, estate planning sets forth specific instructions regarding everything from the type of funeral you’d like to who will receive your assets when you’re gone.


Estate planning is important: after all, no one knows what the future holds. By establishing an estate plan, you not only ensure that your wishes are met, you also minimize stress and conflict among your loved ones in the difficult times following your death or incapacitation.


What is Legacy Planning?

But just because estate planning is important doesn’t mean it’s enough - especially if your goal is not to just distribute assets outright to family members, but also to make an enduring impact. Enter legacy planning.


Did you know that 70% of rich families lose their wealth by the second generation, while a staggering 90% do so by the third? Legacy planning is a proactive and preventative measure that picks up where estate planning leaves off by integrating a person’s values, vision, charitable giving and hopes for future generations into the financial planning process.


Because legacy planning is more ambitious than estate planning, it’s also more intensive. For starters, while you might work with a financial planner when deciding your estate plan, legacy planning is a team effort requiring professional advisors across multiple areas of expertise, including legal, tax, and wealth planning. Depending on your situation, legacy team members may include an insurance agent, your trust officer or your local community foundation.  Together, this team works with you to devise a plan aimed not only at allocating your assets, but also at determining your preferences for how those assets will be managed and protected over the years for future generations and/or charities.


>> Read Managing the Impact of Wealth for Future Generations for more tips for legacy planning and managing multi-generational wealth.


It’s also critical to acknowledge that legacy planning is not about an act as much as it is about a mindset. To that end, legacy planning is a work in progress that should be expected to evolve - and designed to accommodate that evolution. So while estate planning may be comparatively finite in terms of the fact that you can sign the papers and walk away, legacy planning comprises what you can and should do while you’re still alive to nurture your legacy toward fulfilling its purpose.


The good news? Whether you’ve already got an estate plan or you’re starting from scratch, it’s never too late to embrace the bigger picture of legacy planning and all of the abiding benefits that go along with it. Whether you inherited wealth from previous generations or created it yourself, you can take immediate steps to sustain it - against the odds - through legacy planning. Contact a trusted wealth management team - like the experts at Caldwell Trust - to begin building your legacy plan today.

New Call-to-action


Trusts & Estate Planning