An estate is the legal entity that is left in the world after a person passes away. With early planning during the person’s life, an estate can provide a lasting legacy for future generations of wealth.  Without planning, estates can be subjected to liens by creditors and administrative or court-based delays and fees.  Larger estates may be subject to significant taxes.

Proper financial planning involves structuring your finances and assets so that your estate is able to effectively pass on a financial legacy to the people and organizations you wish to support.  The best time to start estate planning is when you begin to make money – at the beginning of your financial career.  The second best time to start estate planning is now!  

Here are a few steps you can take to get started with your financial plan.   

STEP 1: Know Your L.I.F.E.

The first step in analyzing the components of your estate is to look at your state of affairs using the acronym L.I.F.E.  It stands for Liabilities, Income, Final Expenses and Education.  Start by calculating the liabilities you have now including money you owe for loans, taxes and other debts. Then, calculate how much money you make (income you will have to replace somehow if you pass away). Then calculate your final expenses of end-of-life medical care, funeral and burial costs.  Finally, include how much it will cost to educate your children through to university (include yourself in this if, for example, you intend to go to graduate school).  Add these costs up and arrive at the minimum legacy you could leave behind in your estate to maintain a comfortable standard of living for your current and future loved ones when you pass away.  

STEP 2: Identify Your Beneficiaries

Give some thought to who you would want your financial legacy to benefit.  We all know who our loved ones are – but who or what are the ones we want to leave money and assets to when we pass?  Who is going to need it the most?  If you have a business, would it be able to survive its first few years without you? Are there any charitable causes you would want your estate to support?

STEP 3: Call in Expertise

Now you have an understanding of how much money you want and need to have in your estate.  You also have an idea of the beneficiaries you wish to support with your money and other assets.  Armed with this information, it’s time to approach a trusted and licensed financial planning professional.  A financial planner will be able to map out which financial instruments you will need to begin saving, investing and managing risks with a view to achieving your legacy financial planning goals. 

Do you have a solid and up-to-date financial plan? If not, now is the time to take the steps above and begin to put the pieces in place.  When you are ready to call in expertise, you can book a session with me to review the amount you would like to have available in your estate and I can show you options available to achieve your goals.  Click here to book a free, no obligation session with me, on Zoom.