Safeguarding Your Legacy: The Power of Estate Planning

Estate planning. Many people associate the term with dusty wills and complex trusts. However, what if estate planning involved more than just money and possessions? What if it was about safeguarding your life’s work, fostering family unity, and ensuring the future of future generations?

As such, this blog post discusses the essence of estate planning, emphasizing the importance of asset protection and building a legacy that reflects your core values. But before going any further, here’s a breakdown of the concept:

What is Estate Planning?

In estate planning, your wishes and assets are mapped out after you pass away. This includes things like:

• Distributing assets. How do your property, money, and belongings get passed on?
• Minimizing taxes. Tax-saving strategies for your estate.
• Naming guardians. Who will take care of your children or dependents if you cannot?
• End-of-life care. Specifying your medical preferences.

Why is Estate Planning Important?

• Secures your legacy. Make sure your assets are distributed to the people or causes you value most.
• Protects loved ones. Ensures that your beneficiaries are not confused and that stress is reduced.
• Minimizes conflict. Inheritance disputes are less likely to occur when there is a clear plan.
• Provides peace of mind. There is comfort in knowing that your wishes have been documented.

Despite this, estate planning isn’t a one-size-fits-all process. This is why an estate planning attorney can help you develop a plan that reflects your unique situation and goals. But, the help you become more familiar with estate planning is Andrew L. Howell.

Andrew is a well-known estate planning expert. As co-founder and managing partner of York Howell, Utah’s fastest-growing law firm, he guides high-net-worth clients through complex estate planning.

However, his expertise extends beyond legal documents. By aligning legacy with families’ values, Andrew helps them create plans that foster harmony and purpose.

As a sought-after speaker, Andrew’s co-authored book, “Entrusted: Building a Legacy That Lasts,” captures his expertise. In addition to his work, “Riveted: 44 Values That Change the World,” which has been the #1 best-selling book in business ethics on Amazon, he has cemented his reputation as a thought leader in the field.

Andrew’s dedication has been recognized outside of the legal community. In 2015, he received Utah Business Magazine’s prestigious “Forty Under 40” award.

Additionally, York Howell has experienced tremendous growth under Andrew’s leadership. Not only was the firm Utah’s fastest-growing law firm, but it was also one of Utah’s Fast 50: Emerging eight companies in 2016. The firm was named one of Utah’s 100 Fastest Growing Companies in 2022, the only law firm in the state to achieve this honor.

Suffice it to say, there’s no better to explain how you can safeguard your legacy through the power of estate planning. 

Protecting What Matters Most

In addition to wills and trusts, Andrew emphasizes that a well-crafted estate plan extends far beyond those tools. With asset protection strategies such as LLCs and carefully selected jurisdictions, your wealth can be shielded from potential threats However, real protection goes beyond legal shields.

Take, for example, the scenario of your children inheriting a significant amount at a young age. Traditionally, assets would be distributed outright, potentially leading to mismanagement or loss. However, it would be best to use structured trusts to protect your wealth and use it responsibly for generations to come.

Simply put, it is about structuring your assets so they are passed down according to your wishes. Despite this, Andrew states that only 30% of the population engages in any form of estate planning, which can lead to significant issues and loss of control.

Navigating Probate and Inheritance Disputes

In addition to saving on costs, Andrew noted that avoiding probate maintains privacy and prevents inheritance disputes. In his view, implementing a trust can significantly streamline the estate settlement process and reduce family conflicts over inheritance.

Optimizing Asset Protection: Leveraging Different Jurisdictions for Your Goals

C corporations thrive in Delaware due to its favorable corporate laws. With its business-friendly climate and advantageous tax policies, the state is a good choice for businesses seeking long-term growth and protection.

Meanwhile, Wyoming offers compelling advantages to Limited Liability Companies (LLCs). Along with Nevada, Delaware, South Dakota, Tennessee, and Alaska, Wyoming offers robust asset protection measures through mechanisms like charging orders, shielding assets from potential creditors.

Navigating Trust Planning: Domestic Asset Protection Trusts (DAPTs)

In the past, asset protection trusts have been associated with offshore jurisdictions. A paradigm shift has occurred since Alaska introduced Domestic Asset Protection Trusts (DAPTs) in 1997. Individuals can create DAPTs for their own benefit while enjoying enhanced creditor protection within the United States.

With strong case law and innovative provisions, Nevada stands out among DAPT states. Due to its shorter compliance period, Nevada offers a compelling option for safeguarding assets domestically.

The Evolution of Legacy and Dynasty Trusts

A growing interest in multigenerational wealth preservation has led to legacy and dynasty trusts becoming buzzwords in estate planning circles. Although the terminology may vary among planners, the goal remains the same: securing assets for future generations.

Essentially, a trust involves three parties: the grantor, the trustee, and the beneficiary. Structures like DAPTs can preserve wealth and mitigate the eroding effects of estate division, taxation, and third-party attacks.

Addressing the Erosive Effects of Wealth Transfer

Keeping wealth intact across generations requires a comprehensive approach. Legacy and dynasty are part of a good estate plan that minimizes estate taxes, minimize estate distributions, and protects assets from external threats to maintain financial stability and empower future generations.

An individual’s long-term goals, risk tolerance, and goals for the trust determine the jurisdiction and trust structure to be used. Also, a variety of legal landscapes spanning different states can be leveraged to tailor asset protection strategies to the needs of individual and family clients.

Legacy plans, however, must go beyond financial assets and include the values and principles defining a family. Due to this, family expectations, responsibilities, and privileges need to be expressed openly.

Avoiding Trust Fund Babies

Furthermore, Andrew pointed out the pitfalls associated with traditional trusts. Often, families set up trusts that distribute assets outright to children at certain ages, like 25 or 30. There is, however, a risk of losing assets in divorce settlements or being seized by creditors if this approach is taken.

As an alternative, Andrew advocates for leaving assets in trusts for the beneficiaries’ lifetimes, thus protecting them from such risks. Instead of simply handing over wealth without guidance, he emphasized the importance of instilling family values and a sense of responsibility in heirs.

The Role of Values in Legacy Planning

Identifying and codifying the family’s core values is an important aspect of this approach. With COREnology, Andrew helps families articulate their values and incorporate them into their estate plans. Additionally, as part of this process, the family creates a “Family Declaration of Independence,” which explains why it has wealth and guides future generations in its management.

A Game-Changing Tool

In addition to its effectiveness in fostering meaningful conversations and preserving family legacies, COREnology has received praise from industry experts and clients alike. In contrast to focusing solely on financial assets, this approach aims to create a lasting impact across generations based on values and purpose.

Key Takeaways

• Everyone should have an estate plan. You don’t want to wait until it’s too late. You need estate planning to protect your assets and ensure your wishes are followed after you pass away.
• Avoid probate. The probate process is lengthy and public. A trust can avoid probate, saving your family time and money.
• Asset protection. A well-structured estate plan makes it harder for creditors to pursue your assets in the event of a lawsuit.
• Tax planning. It is also possible to minimize your tax burden through estate planning.
• Work with a team. The estate planning process is complex. Create a comprehensive plan with the help of an attorney, accountant, and other financial professionals.
• Investing in trusts isn’t just for the wealthy. Even if you don’t have a high net worth, a trust can still be a valuable tool for protecting your assets.
• Transparency vs. privacy. LLC names offer some anonymity, but complete transparency is increasingly expected. A good plan will be protective even if it is disclosed in court.
• Take a look at different states. LLCs and trusts have other benefits in various states. You should consider these factors when forming your entity.
• Open communication. A successful wealth transfer requires communication within families.
• COREnology. Using this innovative approach, families can integrate values into their estate plans.

In conclusion, it is important to remember that your estate plan should not be put off until it is too late. By planning now, you can protect your loved ones, instill your values, and ensure that your legacy endures for generations.

Featured Image Credit: Binyamin Mellish; Pexels, Thank you!