It is human nature to want to leave a legacy. As the culmination of our lives, a legacy is all about doing something for others, whether they are your children, grandchildren, relatives, friends, or charities. Legacy planning is also known as estate planning.

Despite the usually ideas, it is not necessarily about leaving a large sum of money to others - it may not even have anything to do with money. Your legacy might indicate how items of sentimental value should be dispersed, or may specify who should act on your behalf if something happens to you. It is all about what you believe in and how you want to continue to be known.

The first step in establishing a legacy is to setup your Will. A Will is your plan for how those you care about should be taken care of should something happen to you. Your Will is a critically important legal document, especially if you have younger children. In addition to your Will, if you have saved money for your children or others, you may also want to explore Trusts as potential tax-saving approaches.

In addition to Wills and Trusts, legacy planning also covers an effective strategy for giving gifts. Many people do not realize that they may be taxed even on gifts to a child if they exceed a specified limit in a given year. Paying a gift tax is the responsibility of the person giving gifts. In fact, even charitable donations are not all alike from a tax perspective. Distribution of the assets that you accumulate over your lifetime has many estate tax implications. The other topics in this section (Gifts and Bequests and Trusts) deal with these issues and help you better understand how to plan strategies to your advantage.

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