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Women & Investing

Women and Money: Best Practices for Legacy Planning

Women now control about $14 trillion -- more than half -- of all personal wealth in the U.S. And that number is about to climb more than twice as high. According to industry research, the pace of the "great wealth transfer" will rapidly accelerate over the next three to four decades. In fact, roughly $30 trillion in wealth is set to change hands due to a couple of key demographic factors: baby-boomer women are outliving their spouses and inheriting from their aging parents.

These and other trends magnify the need for women to be involved in, informed about, and comfortable with their role as guardians of family wealth. Active participation in wealth management can strengthen your commitment to protect and grow the assets under your control, with the goal of leaving a legacy for your children, your communities, and beyond.


Best Practices in Legacy Planning

You have cared for your family most of your adult life. The following strategies can help you continue to care for them by assuring the smooth transfer of your measurable wealth -- and your values surrounding wealth -- to the next generation.

1. Education leads to confidence. Attaining financial security for you and your heirs typically requires you to accept responsibility for the management of significant investment assets. Whether you are single, married, or a surviving widow, it is in your best interest to obtain as much education as possible about wealth planning, investments, and related matters. Even if you are not directly responsible for making important financial decisions, it is vital to have knowledge in these areas in order to communicate effectively with professionals charged with these duties.

2. Professionals offer objective, qualified services. Relying on professional advice as opposed to family and friends is extremely important when making decisions affecting the accumulation, preservation, and distribution of wealth. What should you expect from a qualified professional? A good wealth professional -- or a team with other professionals, such as attorneys and accountants -- should offer guidance and services in most areas of wealth management, including estate planning, retirement planning, insurance needs assessment, and college planning.

On a more personal note, a wealth professional should work closely with you to:

  •     Identify areas requiring special assistance, such as creating trusts
  •     Minimize taxes and planning costs
  •     Develop and implement a personalized wealth management plan
  •     Review your plan periodically and suggest changes when needed

3. Philanthropy is integral to family legacy planning. Wealthholders have a greater opportunity -- if not responsibility -- to make charitable giving an integral part of the legacy planning process. Families that are charitably inclined may have clear goals in mind, but they might not know where to begin. In order to choose the best strategy, you should work with a trusted professional to evaluate a number of factors, such as tax management objectives, types of assets to be gifted, and your specific strategic intent. Then choose from among a range of charitable-giving vehicles, such as donor-advised funds, family foundations, gift annuities, and charitable remainder trusts/charitable lead trusts.

4. Children should learn about the responsibilities of wealth. Wealth is a gift that opens doors of opportunity not only for you but also for your children, their children, and generations to come. Yet wealth can be a weighty responsibility that takes time to manage, maintain, and preserve. If you are a parent, you are no doubt concerned about the effects of wealth on your children's values and how the money lessons you pass on to them will resonate as they mature to adulthood.

5. Family values should be held in the same high regard as family wealth. Family values -- those traits, beliefs, goals, and morals that are often shared by members of a family group -- define a family's character as much as dollar signs measure a family's wealth. By holding shared values in high regard and setting an example of commitment to financial responsibility, philanthropy, and volunteerism for the younger generation, you will enrich your family's legacy for generations to come.


A Woman's Worth

As stewards of the family legacy, women are in a unique and influential position. They are holders of great wealth as well as keepers of the family's moral and philanthropic vision. There are many financial, accounting, legal, and business tools to assist women in implementing a plan of action. Contact a financial professional for guidance in mapping out a legacy planning strategy unique to your situation.

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UnionBanc Investment Services is making this article available for general informational purposes only and does not purport it to be a complete analysis of the subject discussed. Nothing contained in this material is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this article should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional.

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