Preparing heirs to manage wealth requires early financial education, open family communication, hands-on experience, mentorship, and a strong focus on philanthropy to build long-term financial responsibility and purpose.
Executives face many unique challenges when managing their personal financial and estate plans. The demands of their occupation often render them unable to dedicate the necessary time and focus to achieving, and sometimes even establishing and defining, their personal financial goals. Successful executives must review their financial situation to ensure the integration of benefits and compensation with strategies for estate planning, investment planning, income tax preparation and planning, risk management, long-term cash flow, and retirement planning.
What Are Executives Often Concerned With?
Allow us to share some insight as to what can worry an executive from a financial perspective:
• Liquidity issues
• Concentrated stock positions
• Transfer of vested stock options
• Giving to charity in a tax-efficient manner
• Executing and funding Buy-Sell agreements
• Whom to name as beneficiary of Qualified Plan Assets
• Lifetime gifts
• Estate tax
• Compensation planning and income in respect of a decedent
• When to retire (forecasting of complex benefits)
• Investment Planning (considering income tax and estate tax issues and lastly)
• How much liability insurance is truly enough
How To Find the Right Team of Advisors
Too many times, executives receive advice targeted to handle one piece of their very complex financial picture. It’s important to always find a team of advisors who act in the executive’s best interest. It is also critically important to have a team of advisors that are communicating.
A CPA, an estate planning attorney, and an investment professional should be working together and discussing the executive’s:
• Income tax bracket
• Impact of Medicare surtax
• Estate tax rates
• Investment options and many other considerations
What To Consider When Choosing a Team of Advisors
Each professional has a different area of expertise and a different relationship with the executive. By sharing information and working together, these professionals enhance the overall planning experience for the busy executive. Without understanding the complete financial picture, goals, and objectives, it is impossible to make recommendations that result in the best solution. A business executive needs an integrated, comprehensive plan that addresses estate planning, asset protection planning, income tax planning, and retirement planning. This plan should be revisited at least annually and when there are significant changes in any area.
The advisor team must also help the executive define personal philosophies and objectives. In today’s busy world, we often don’t place enough importance on the legacy that the executive wants to leave. Generally, they want the wealth they’ve accumulated to impact their family and friends. Many people define themselves by their profession and career accomplishments. Our careers contribute to a large part of our self-worth, long-term relationships, and daily life structure.
When it comes to retirement, some people embrace this new beginning, spending more time with family and friends, pursuing hobbies, or volunteering. Others, even the most financially secure, often worry about no longer having a regular paycheck and struggle with transitioning from the accumulation phase of their financial lives to the distribution phase. Working with the right advisors to formulate a comprehensive plan provides for a smoother transition into retirement and helps relieve some of the stresses associated with making that transition.
Choose a Premier Team of Investment Professionals at the Central Trust Company
At the Central Trust Company, our team of investment professionals will help you create a great financial plan to make for a seamless transition from working life to retirement. Contact us or find your nearest branch online to get in touch with our team today!
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