Legacy Planning: Leaving More Than Money Behind

When most people hear "legacy planning," they think about estate documents and asset distribution. That is part of it. But the families who approach legacy planning most meaningfully are thinking about something broader: what do they want to pass on beyond their financial assets? What story do they want to tell about how they lived and what they valued?

The Limits of Financial Legacy

Research consistently shows that inherited wealth, without accompanying values and purpose, often dissipates within a generation or two. The phenomenon has a name among wealth advisors: "shirtsleeves to shirtsleeves in three generations." It appears in cultures around the world, which suggests it reflects something fundamental about human nature rather than specific circumstances.

What makes the difference is not the size of the inheritance — it is whether the recipients have a framework for stewarding it. Families who transmit values alongside assets fare dramatically better than those who transmit only assets.

What a Values-Centered Legacy Includes

An ethical will or legacy letter

A legal will distributes your assets. An ethical will — sometimes called a legacy letter — transmits your values, your life lessons, and your hopes for those who come after you. It need not be long or formal. A letter to your children or grandchildren that explains why you made the choices you made, what you believe, and what you hope for them can be one of the most meaningful things you ever write.

Purposeful charitable giving

For families with a charitable dimension to their legacy, the structure matters. A donor-advised fund, a charitable remainder trust, or a private foundation can each serve different goals. The right structure depends on the size of your giving, the causes you care about, and whether you want to involve future generations in the giving process.

Family financial education

One of the most overlooked elements of legacy planning is preparing the next generation to receive and steward what is coming. This means honest conversations about money — what you have, how you built it, and what you expect of them — not as a surprise at the reading of a will.

Giving During Your Lifetime

Many families find that giving during their lifetime is more meaningful than giving through their estate. You can see the impact. You can involve yourself in the causes you support. You can give while your children watch, modeling generosity as a value rather than simply transferring it as an asset.

Annual gift tax exclusions allow each individual to give up to a certain amount per recipient per year without gift tax consequences. For larger transfers, strategies like gifting appreciated securities, funding 529 accounts, or using irrevocable trusts can serve both generosity and tax efficiency.

Where to Start

The most important first step in legacy planning is simply articulating what you want your legacy to be. Not what you think it should be, but what you actually want the people you love to remember about you and carry forward. Start there, then build the financial structure to support it.

Our team works with families to build legacy plans that go beyond documents and distributions. Reach out if you would like to start that conversation.