What Is Legacy Planning—and Why It Matters More Than Ever
Key Takeaways
Take Control of Your Legacy: Legacy planning empowers you to make crucial decisions about your assets, dependents, and estate management, ensuring your preferences are honored and avoiding potential legal complications.
Essential Steps to Begin: Start by taking inventory of your assets, clarify your inheritance wishes with your family, and seek expert advice from an estate planning attorney to tailor your plan to local laws and your unique situation.
Core Components of a Comprehensive Plan: Include key documents like a will, beneficiary designations, durable power of attorney, advance medical directive, and consider trusts for effective asset management and tax minimizationLegacy planning is more than just writing a will—it's a thoughtful, comprehensive strategy for ensuring that your values, assets, and wishes are carried out when you're no longer here.
It’s about creating clarity for your loved ones, minimizing confusion and conflict, and—perhaps most importantly—making sure you, not the state, decide how your affairs are handled.
We don’t know when our time will come. But we do know that it will come. When it does, having a plan means having a voice—and leaving a legacy that can positively shape the lives of the next generation.
What Is Legacy Planning?
After a lifetime of building, saving, and investing, most people eventually begin to ask: What will I leave behind?
Legacy planning is the process of identifying what you want to pass on—both tangible assets like money and property, and intangibles like values, traditions, or a commitment to charitable causes. While it overlaps with estate planning, legacy planning goes one step further by considering the lasting impact you want to have.
This might include:
Creating a will
Naming beneficiaries
Setting up trusts
Planning for estate taxes
Designating medical and financial decision-makers
Outlining charitable giving goals
It can be simple or complex depending on your situation—but either way, it's essential.
Why Legacy Planning Is So Important
Here’s a startling fact: Only 4 in 10 Americans have a will or living trust in place.
Without a plan, you leave crucial decisions—like who gets your assets, who cares for your dependents, and who manages your estate—up to your state’s default laws. These laws likely won’t reflect your preferences and could cause delays, expenses, and family stress.
Legacy planning puts you in control. It helps avoid unnecessary legal complications, ensures your loved ones are taken care of, and gives you peace of mind knowing your affairs are in order.
How to Get Started
Legacy planning begins with three simple steps:
1. Take Inventory
Start by listing your assets: bank accounts, retirement funds, real estate, business interests, insurance policies, and personal possessions. Note where they’re held and who currently has access.
2. Clarify Your Wishes
Think about who you want to inherit your assets—and how. Do you want to leave a portion to charity? Who should handle your estate? Have open conversations with your family to make your intentions known.
3. Consult an Expert
Even if your estate seems simple, state and federal laws can complicate things. An estate planning attorney can help tailor your plan to your unique situation and ensure it complies with local laws.
Key Elements of a Legacy Plan
Here are the core documents and tools to consider:
Will: Specifies how your assets will be distributed, names guardians for minor children and pets, and appoints an executor to carry out your wishes.
Beneficiary Designations: For retirement accounts and life insurance policies, ensure beneficiaries are updated—and include contingents to avoid probate.
Durable Power of Attorney (DPA): Grants someone authority to act on your behalf if you become incapacitated. This avoids court intervention.
Advance Medical Directive: Combines a healthcare DPA, living will, and HIPAA release. It guides medical decisions if you’re unable to speak for yourself.
Life Insurance: Provides financial support to your loved ones. Not sure how much you need? Use Prudential’s Life Insurance Calculator to estimate the right amount.
Trusts: Useful for managing assets, avoiding probate, and minimizing estate taxes. A living trust, for example, allows you to dictate how and when beneficiaries receive assets.
What You Can Do Next
Start with a conversation—with yourself, your family, and a professional. Think about your values. Imagine the legacy you’d like to leave behind.
Then, map out a basic plan and connect with an estate planning attorney who understands the laws in your state. Even a general idea is enough to begin crafting a plan that fits your vision.
Need help getting started? I can connect you with a qualified estate attorney who fits your needs.
