Discussing family finances is often seen as a taboo subject. But such discussions are important to have in order to sort out any financial issues, to outline personal wishes and to effectively plan for estate management if a parent became incapacitated or passed away.

During these difficult times, preparation and planning can alleviate some of the challenges for loved ones, assuring that personal care can be arranged and personal wealth is passed on efficiently. This is why intergenerational planning works best as a whole family. In this article, we outline the main benefits of intergenerational planning for all of the family.

Inheritance Tax and intergenerational planning

Inheritance Tax planning is a key part of intergenerational wealth management. Through effective planning, the Inheritance Tax burden a family can face when a loved one passes away can be reduced. This may come in the form of gifting, investments and trusts, or choosing tax-efficient investment vehicles to pass on your wealth. What is often overlooked is that Inheritance Tax will not just affect one generation but can potentially pass from one to the next. This is why planning inheritance tax between generations and in the long-term is an effective wealth management strategy.

Practicalities

Getting organised with your finances can alleviate a lot of the stress that follows a bereavement. Practical steps can make all the difference at this time, whilst also making sure your personal wishes are followed. Keeping your Will, expression of wishes, choice of executors, power of attorney and your pension nomination of beneficiary up to date are all important.

Letting your family know exactly how to retrieve financial documents and information is also vital, particularly as many policies are now paperless. Practical steps such as keeping important paperwork and access information in a lockable fire proof box and sharing all the key contacts for your family to correspond with can make all the difference.

Sharing a financial adviser

One way in which intergenerational planning can take place with all members of a family is to share the same financial adviser. This can have many benefits.

• It can allow family members to effectively plan their finances, wealth generation and management in a way that will pass personal wealth efficiently and where it is truly needed.
• It can help to keep all members of the family on the same page when it comes to financial planning, whilst also allowing for individual advice.
• Family financial positions can be understood in detail, revealing better strategies and solutions for personal finances.
• Each family members financial values and aims can be taken into consideration.

Talk to us

There are many considerations to take into account when it comes to intergenerational planning and each plan must be uniquely tailored to your family’s needs and financial goals. It is, therefore, important to speak to a specialist financial planner to get independent advice on what strategies will work best for you and your family.

PLEASE NOTE: Grosvenor Wealth Management Ltd is authorised and regulated by the Financial Conduct Authority. Estate planning is not regulated by the Financial Conduct Authority. The value of investment can go down as well as up and you may not get back the original amount you invested. Tax treatment is dependent on individual circumstances and may be subject to change. Tax planning is not regulated by the Financial Conduct Authority.