Your Children Need More Than Your Good Looks

Retirement Wealth Beats Good Looks

Got Too Much Money|Pass It On

Transferring wealth from one generation to the next is a common financial move used by individuals who have extra retirement money they will not need.   If you find yourself in this situation, follow this 3-step process used by many wealthy individuals.

Step #1 – Have A Will

In the event of your death, your beneficiaries will thank you many times over if you had a will drawn up.

You Don’t Need A Will, Your Family Knows What You Want

Everyone needs a will.   Without a will the courts, not you, will decide how your estate gets divided up.

Your family’s knowledge of how you want your estate distributed has nothing to do with it.   It is the law in most states that ones estate must go through probate if there is no will and testament in place.

  • A will keeps your estate out of probate.
  • By avoiding probate your family retains more of the inheritance money you intended for them.
  • A will keeps the court costs and attorney fees to a minimum.
  • Your family receives their inheritance much quicker with a will; probate can tie up your assets for years.

Step #2 – Choose Transfer Vehicle Wisely

If your financial goal is to pass on your extra retirement income, you will need a funding method.

  • Transfer Wealth|Stocks, Bonds, Mutual Funds, Cash

Your retirement investments could remain in typical retirement investment vehicles: stocks, bonds, mutual funds and cash.   The negative of that is the value of those investments could be depressed at the time of your death.  Therefore your beneficiaries will receive less of your money.

The assets are also taxable, again, a waste of money.

  • Pass on wealth to loved ones once you retire

    Transfer Wealth|Life Insurance

Life insurance gets a bad reputation but is a very useful financial tool for passing on retirement wealth.    The death benefits of a life insurance policy pass onto your heirs income tax-free.   They get your death benefit and they save money on taxes.

  • Transfer Wealth| An Annuity

Annuities also have an unfavorable reputation but again can be a useful funding vehicle for wealth transfers.

An immediate or deferred annuity can have the payment options set up to extend to your children.   When you die, the annuity payments will continue to pay them.

Step #3 – Hire A Financial Planner

If making financial decisions makes you a bit nervous, you might want to consult with a financial planner for the purchase of an investment product.

Work with a planner whom you trust to have your best interests in mind, not theirs.

Some financial planners sell product, others charge for their time and advice; each type of planner serves a purpose.    Choose the type that you trust to service your financial needs.

Never Stop Planning

Congratulations, you accomplished step one, you reached retirement financially successful.   However, reaching retirement does not mean you get to stop planning and preparing your finances.

Retirement was just the first step, the second step is learning how to pass your extra money onto your loved ones.