Over the past few months, we’ve spoken a great deal about estate taxes and estate planning – and with good reason! In our April blog, “Sunset or Repeal – what does the future hold for Estate Taxes and Estate Planning?”(1), we discussed the realistic ways investors should prepare themselves for the possible coming sunset on certain federal state taxes and exemptions. If changes in the tax landscape are enacted, we’d like to give our clients and friends all the widest window possible to prepare themselves financially. The blog’s author, our Vice President, Estate Planning, Malia Haskins, was also the spokesperson for our 5-part video series on estate planning, taxes, and the preparations associated with passing down an estate.
The start of our “Clarity in Estate Planning” video series(2), primarily focuses on helping those who have little to no experience in the estate planning world familiarize themselves with the basics. Malia explains technical definitions, key documents to acquaint viewers with, and goes over the professionals that they should be seeking advice from. As Malia’s video series progresses, she digs into the philosophies of Nepsis; Clarity and our Family Office Framework.
Tax solutions, investment management, insurance and even estate planning can become complicated when these individual aspects are not properly connected to one another. At Nepsis, we roll all the pillars of your financial planning together, finding the right strategy to position them for achieving your unique goals. Proper advisement can mitigate any issues that may arise due to previously established trusts or charitable giving.
So, what makes an estate plan successful?
Our research indicates that inheritances are often spent in an 18-month to 5-year period. As advisors, we find this concerning, recognizing that many families wish for their estate to reach multiple generations. We’ve found that greater family involvement within the original estate planning process is one way to make the recipients better stewards of their inheritance. Knowing what you will receive and when you are expected to receive it allows individuals to become familiar with the larger strategy at work and grants soon-to-be recipients the time needed to organize their finances. We’ve also found that educating recipients on why they are receiving their inheritance and where it came from can be a powerful way to improve the longevity of the financial windfall passed down.
Estate planning for business owners can get even more complicated, but implementing an estate plan that provides for business succession should be considered a top priority. With so many balls to juggle it’s hard to fit the time needed for estate planning into busy schedules. But when it comes down to passing on what has been built to the next generation. A significant amount of planning will be needed to ensure your intended recipients do not experience unnecessary complications that can reduce the value of an inheritance. A detailed will is a good place to start, but when it comes to your business, designing the right estate strategy will bring a new set of challenges to the table. Luckily for her clients, Malia is an experienced advisor with over 20 years in the estate planning field. She’s seen the evolution of the estate planning landscape and has recommendations for business owners who’d like to prepare as thoroughly as possible.
Protect your assets. Having a strong succession plan in place will be a key to ensuring there are no lapses through the transitional period of passing on the torch. Visions and value matter, so whether you are passing ownership onto a partner, successor, or future generation, it is important to make sure a clear roadmap is in place for them to follow. But what’s next for you?
Planning for your personal finances post-exiting your business will bring a new set of obstacles. Many former business owners have reported feeling regret over selling their businesses due to a lack of outlets to put their energy into. Focus on your passions, hobbies, and what retirement goals you’d like to accomplish in this new phase of life. Golf and travel are not the only options.
The final part of the video series focuses again on how investors and estate planners should prepare themselves in the case of a sunset on the Tax Cuts and Jobs Act (TCJA). If this sunset does occur on the TCJA at the end of 2025, advisors will need to make major strategic adjustments in reaction to new estate tax exemption amounts. Malia recommends gifting strategies as an effective way to prepare this year in advance of this major estate planning shake up.
To learn more about our approach to Estate Planning and our Family Office Framework, please read Malia’s blog and watch her 5-part video series in the links below.
- Blog: Click here.
- Video Series: Click here.
You can also find Malia’s appearance on our It’s All About Clarity® Podcast here to learn more of her thoughts on the broader market landscape as it stands this year: Click here for Podcast.
To schedule a meeting to discuss your unique estate planning situation, visit us here.
It’s All About Clarity®.
Advisory Services offered through Nepsis, Inc., An SEC Registered Investment Advisor.