By Gerald Robinson, CFP®
Over the years of creating financial plans for my clients, I stumbled upon a fascinating trend. Some of them, despite having a sizable income and assets to fulfill their retirement goals, ended up passing away with a significant sum of money. This prompted a thought-provoking question: Would a person prefer to see the benefits of your giving while you were alive or pass the assets on at death?
To address this question, our team at LightForce Financial decided to develop a financial strategy that includes a focused decision to give money on an annual basis to loved ones and favorite charitable organizations. This new financial plan with a directed amount of giving each year is reviewed and updated at least once annually to stay on target toward the long-term goals of the client.
Below are the three tools we utilize to develop our unique accelerated inheritance financial plan.
1. Direct Giving With Purpose
Setting up a plan that includes direct giving with clear controls and limitations allows our clients to set funds aside for specific purposes so their wealth serves meaningful goals both during their lifetime and after.
With this particular strategy, we outline distinct categories for giving, each with its own set of predefined goals and restrictions. For instance, your funds could be earmarked for purchasing a new home, providing assistance with future retirement expenses, covering college or postgraduate costs for family members, or addressing any other significant financial needs that arise.
This proactive approach not only allows for an accelerated inheritance, but also provides our clients with a sense of fulfillment knowing their resources are being utilized to support their loved ones and fulfill their most cherished goals.
2. Exploring New Financial Avenues
The second component of our financial plan to accelerate the inheritance process includes establishing specific accounts while offering opportunities for wealth accumulation and strategic financial planning. By setting up Roth IRAs, education savings accounts, 529 college savings plans, individual or joint investment accounts, minors’ accounts, and utilizing qualified charitable distributions (QCDs) from traditional IRAs, we provide our clients with diverse options to bolster their financial portfolios and meet their long-term goals.
These accounts each serve specific purposes, from retirement savings to education funding and charitable giving, and are instrumental in customizing solutions that align with our clients’ unique needs and priorities. Adding these options into the strategy allows our clients to accelerate their inheritance process while laying a solid foundation for a stable financial future.
3. Maximize Your Giving Potential
Finally, consider establishing a donor-advised fund (DAF), the third tool of our accelerated inheritance process. These funds allow you to make contributions, receive immediate tax deductions, and recommend grants to your favorite charities over time. By setting DAFs, particularly during periods when you find yourself in a lower tax bracket, you can increase the impact of your charitable giving while reducing your tax liabilities.
Additionally, we recommend specialized insurance products tailored to meet our clients’ specific giving goals. These products are designed to provide financial support to your chosen beneficiaries or charitable organizations upon your passing so your legacy continues to make a difference long after you’re gone.
Embracing a Generous Legacy
Using this approach of accelerated inheritance has served many of our clients, and my wife and I are no exception. Inspired by the potential to make a tangible impact on the lives of our loved ones while contributing to causes close to our hearts, we have wholeheartedly embraced this approach with ambitious goals in mind.
With a shared vision of giving back to our community and supporting future generations, my wife and I have set a lofty goal of giving $1,000,000 prior to reaching old age. This goal serves as a guiding light, motivating us to proactively engage in strategic financial planning and charitable giving initiatives.
Ultimately, the greatest reward of accelerated inheritance is the sense of fulfillment that comes from helping others. Whether it’s witnessing the smile on a loved one’s face or seeing the transformative impact of our contributions on a charitable cause, every act of giving brings us immense joy and satisfaction.
Work With a Trusted Professional
If you’re thinking about accelerating your inheritance, it’s wise to take the time to evaluate your financial status and decide if it’s the best decision for you and your family. We recommend collaborating with a financial advisor who can guide you through the process and assist you in creating a well-informed plan.
At LightForce Financial, we’re dedicated to empowering our clients to feel confident about their financial plan, including accelerated inheritance options. To discover how we can assist you, reach out to us at (817) 896-2744, email gerald@lightforcefinancial.com, or select an appointment online.
About Gerald
Gerald Robinson is Founder of LightForce Financial, a fee-only financial services firm based in Denton County, Texas, specializing in guiding multi-generational families and small and mid-sized business owners through the inevitable—change. Gerald and his firm provide one-on-one service and a long-term approach to goal achievement. He’s fulfilled by developing long-term relationships with clients as he helps align their wealth and values through a personalized financial plan.
After graduating with a BBA with a focus on finance and statistics from UNT, while serving in the United States Marine Corp Reserve, Gerald began a long career in mid-management of a large retail food chain. In 1999, with the desire to serve clients by building a business that would be of value and positively impact their lives, he returned to his roots and began his journey as a financial professional. In 2009, Gerald acquired his CERTIFIED FINANCIAL PLANNER™ designation, and now serves clients as an independent CFP® professional on a fee-only basis—no commissions. For over 30 years, Gerald has lived in Flower Mound with his wife; he also has three children and five grandchildren. In his spare time, he enjoys staying involved in his community, serving on various commissions and boards. To learn more about Gerald, connect with him on LinkedIn.
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