When we talk about leaving a legacy, we often think about drafting a will. But the true essence of legacy planning goes beyond the transfer of wealth––it includes knowledge, values, and financial wisdom that can empower future generations. Here’s what you need to know about legacy planning beyond wills and how you can ensure your ideas, not just your money, are left in the right hands.

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Financial Wisdom Over Wealth

Having a lot of money is nice, but the gift of financial literacy can be even more meaningful. A holistic approach to legacy planning aims to benefit your descendants long term. There are a few key ways you can impart financial wisdom, even after you’re gone. 

Educational Trusts

Educational trusts drive home the value of investing in learning, not just the stock market. They provide funds specifically to support your descendants’ educational pursuits, whether it be traditional schooling or personal development. This helps foster financial wisdom for setting clear parameters for using funds and guiding your descendants to prioritize their education without the burden of debt.

Family Meetings for Legacy Planning

Regular family meetings create a platform for discussing financial matters openly, encouraging transparency and reinforcing shared financial values. Families should be on the same page in terms of finances. Looking to book that trip to Disney next year? Host a family meeting to discuss how you will budget and save over the next several months. Making these meetings a part of your regular routine is a great way to build a legacy of financial responsibility.

Documenting Family Financial Stories

There’s much to be learned from the past, and personal family stories can be especially impactful. For example, if Grandpa launched a failed business, it may be worthwhile to sit down with the younger members of your family, explain where he went wrong, and discuss strategies to avoid similar mistakes down the line. These stories can also serve as reminders of your family’s strength and resilience in weathering tough financial storms, giving loved ones hope that they, too, can make it out alive.

Tools and Techniques for Legacy Planning

While education forms the backbone of financial wisdom, using the right tools and techniques can amplify its impact. Consider the following methods to build a strong legacy of smart money management.

A Family Mission Statement

A family mission statement can serve as a guiding principle for legacy planning. It reflects collective values and goals, providing a framework for making financial choices that align with your family’s legacy vision. It should include the following:

  • Core Values: Start by identifying the fundamental values that represent your family’s beliefs, like integrity and generosity. These values should resonate with all family members and guide their behaviors and decisions.
  • Financial Philosophy: Your mission statement should also articulate your family’s philosophy towards financial management. For example, some families are committed to frugal living, while others are passionate about supporting charities. Consider your family’s approach to money and how it will guide future generations.
  • Roles and Responsibilities: Set clear roles and responsibilities for each member of the family. Emphasize the importance of clear communication and conflict resolution. 

The key here is to create alignment on what matters most. We all have different ideas on how to best handle finances, but it’s important to create a mission statement that serves as an overarching guide for financial management. 

Financial Education Technology for Legacy Planning

Apps, online courses, and other digital tools make learning fun and can go a long way in leaving a successful financial legacy. For instance, you can download finance apps like Rocket Money to help younger family members practice real-world money management. By integrating technology, your family can build an evolving resource hub, making financial education adaptable and interactive.

Navigating the Emotional Aspects of Legacy Planning

Legacy-building can be emotionally challenging, partly because it comes with the unspoken acknowledgment that you won’t be around forever. While creating a family money philosophy and leveraging the right tools is important, it’s equally important to facilitate open communication between all family members. Encourage loved ones to share their feelings and concerns about estate planning and legacy without judgment.

Involving them in these discussions early on can help alleviate some of the anxiety that comes with shifting family dynamics. Your family may not remember how every single asset was divided, but they almost certainly will remember how you chose to handle the transfer process. Part of building a lasting financial legacy is helping loved ones navigate the emotional complexities that come with inheritance, and by offering gentle guidance, you can do just that.

Secure Your Financial Legacy Today

What’s better than achieving financial freedom? Passing that freedom along to your descendants. Instilling in your loved ones a philosophy of smart financial management is truly a gift that keeps on giving, and by sowing the seeds now, you––and your family members––can reap significant returns later in life. 

 

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