Keep the wealth in your family
An unprecedented transfer of wealth beckons – and it isn’t between businesses or government. This is a transfer of wealth that will take place in tens of thousands of families in every community.
As our parents and grandparents age, the challenge of ensuring that the family fortune stays in the family requires a specific approach to financial planning. Seniors naturally want to ensure that the fruits of their life’s labour will be kept in the family. As they grow older, it’s a road baby boomers must also soon travel. Canadians need a strategy to pass their wealth from one generation to the next.
Despite the obvious benefits of planning and preparing for the transfer of wealth within generations, a recent Advisor Impact survey of 6,300 financial advisor clients shows that fewer than half of Canadian consumers have discussed plans for their estate with their families.
“Ignoring this challenge invites not only future acrimony among family members,” says Kris Birchard, veteran advisor and chair of the Chartered Life Underwriter Institute (CLU), “it can lead to much of your wealth falling into the hands of others.”
Consider the following tips from CLUs, as you begin your planning:
- Start yesterday. Get planning now; don’t wait until it’s urgent.
- Include the entire family. Not only should everyone understand the key issues, inclusion can help you deal with the sometimes emotional issues that surround the transfer of wealth within a family.
- Establish a clear timeline for the process.
- Embrace a holistic approach. You want the full range of solutions in this area, including long-term care insurance, counseling, legal advice, charitable giving and education funding – and don’t forget the family cottage.
Start by forming a relationship with a financial advisor who has expertise in this area and be sure that individual is looking at the big picture. A CLU advisor, for example, is skilled in advance life insurance applications, tax and estate planning solutions, and has specific knowledge of intergenerational wealth transfer strategies.
To find a CLU advisor in your community visit www.findaclu.ca or call 1.800.563.5822.
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