Retire Wise | April 2023

Why Making Wealth a Family Affair Makes Good Sense

A reported $84.4 trillion in U.S. household wealth is expected to transfer over the next 20 years. Baby boomers alone are anticipated to shift an estimated $53 trillion—representing 63% of all wealth transfers—most of which will go to family members.¹ As wealth shifts to the next generation, it’s critical to ensure that those inheriting family wealth have a clear understanding of how it will transfer, and any intentions or stipulations associated with it. That begins with clear and open communication. However, talking about money can be difficult or may even be considered taboo for many families. Yet, failure to clearly communicate your wishes to family members can lead to unnecessary conflicts or misunderstandings—both during your lifetime and after you’re gone. That’s because younger generations often lack insight into the inner workings or complexity of the older generation’s finances.

Transparency and communication are necessary components of a wealth transfer strategy intended to serve your interests, as well as your heirs. While no one wants to think about it, imagine if a significant life event occurred today, leading to your incapacity or death. How easy would it be for your children or others you have appointed to step in to make important medical decisions on your behalf, arrange for the type of care you prefer, ensure your bills are paid, or carry out your end-of-life wishes? While families often touch on these subjects through informal discussions, documenting your wishes can help ensure family members are aware of your wishes and are able to access the information needed to carry them out well before a crisis occurs.

While important legal documents, such as a will, trust, and powers of attorney form the foundation of a solid estate strategy, many families supplement these with something called a “family love letter.” A family love letter is an informal and non-legally binding document used to communicate important information that may fall outside of your legal documents. It can be as detailed as you want and can play a vital role in communicating information to loved ones, such as the location of financial account information, medical and tax records, contact information for your medical and professional advisors, or who gets the dining room table and chairs. It can help communicate information about your end-of-life wishes and legacy that may not be contained in a will or trust, such as family history you want to pass down to your grandchildren or the type of music you would like played at your celebration of life. It may also provide a way to document your philosophy, vision and values about money, pertaining to education, charitable giving or other considerations. While a family love letter is not legally binding, it can be an important tool to begin important conversations about family wealth that can prove beneficial to all parties.

If you would like to discuss tax-efficient strategies for managing and transferring multigenerational wealth, contact the office to schedule time to talk.

^{1 Godbout,Ted. “Wealth Transfers to Hit $84 Trillion Through 2045.” NAPA.com, 26 Jan 2022, https://www.napa-net.org/news-info/daily-news/wealth-transfers-hit-84-trillion-through-2045}

Want to Learn a New Skill? Consider Volunteering.

Multiple studies have found that lifetime learning can go a long way toward keeping our brains sharp as they age. One of the best ways to accomplish this is by challenging yourself to master a new skill.¹ If you’re looking for an easy and inexpensive way to learn a new skill from cooking to carpentry, or to further sharpen an existing skill, consider volunteering. Many organizations are happy to provide training to volunteers who are eager to lend their time to help organizations accomplish their important goals.

National Volunteer Week, which is scheduled for April 16 – 22, 2023, is as good a time as any to get started. Organized annually by the Points of Light Foundation, National Volunteer Week was established in 1974 to recognize the impact of volunteer service and the power of volunteers to tackle society’s greatest challenges.² For those seeking a challenge, Points of Light provides an extensive database of volunteer opportunities from thousands of organizations, making it easy to match volunteers with organizations in need. You can visit pointsoflight.org to scan their database for opportunities near you, or reach out to local organizations you may already be familiar with, such as:

• Food kitchens or pantries affiliated with local religious or community organizations
• Organizations like Habitat for Humanity where volunteers can hone a broad range of skills, including carpentry, plumbing, painting, landscaping, and more
• Needlework groups that meet to craft items for community members in need of scarves, hats, socks, blankets, and layettes (Check your local crafts or needlework store if you have trouble finding a group near you.)
• Local schools seeking tutors, mentors, crossing guards, and other volunteers
• Youth sports organizations offering coaching and related opportunities to support local teams
• Animal shelters and rescue centers, which offer a variety of ways to help, from fostering to assisting with feeding, walking, training and healthcare needs, fundraising, and adoption programs
• Environmental groups seeking assistance with organizing events, fundraising, or helping to keep parks, forests, and beaches pristine
• Nursing homes and elder-care centers and programs seeking assistance with activities, including music, dancing, art, crafts, yoga, gardening, etc.

Whatever your interests, sharing your time and talent with members of your community can provide numerous rewards, from mastering new skills, to making new friends and broadening your social circle, and feeling good about the impact you’re making on the world around you.

^{1 “Train your brain.” Health.harvard.edu, 15 Feb. 2021,  https://www.health.harvard.edu/mind-and-mood/train-your-brain
2 Pointsoflight.org, https://www.pointsoflight.org/national-volunteer-week/. Accessed 28 Mar. 2023.}

^{This information was written by KRW Creative Concepts, a non-affiliate of the broker-dealer.}

^{This communication is designed to provide accurate and authoritative information on the subjects covered. It is not, however, intended to provide specific legal, tax, or other professional advice. For specific professional assistance, the services of an appropriate professional should be sought.}