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Generational Planning

Posted by Michael Kane on Dec 16, 2016 1:50:43 PM
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generational-planningOne of the best ways to ensure the smooth transfer of wealth within your family is to make generational planning a key component of your overall financial and retirement strategy. 

It’s important that each generation – children, parents, and grandparents – understand their specific roles and responsibilities when it comes to protecting an estate which represents a lifetime of hard work and solid decision-making. 

We’ve all heard horror stories of young adults who, in anticipation of a substantial inheritance, fail to pursue advanced education or a career. These so-called “trustafarians” often lack purpose and direction in their lives, and the money that was supposed to provide them with security and freedom stunts their drive and ambition instead. Or, the classic tale of the college student who receives an inheritance and takes twenty fraternity brothers on a week-long trip to the islands instead of saving and investing for a secure future.

Talking about generational assets can be uniquely difficult for grandparents. Facing one’s own mortality and planning for a future that doesn’t include you is hard. Whether they were the primary earners or will be beneficiaries of services like long-term care, grandparents should be included in discussions about their wishes and goals for their own health and medical care in addition to the division of assets they would like to see in their family for future generations.


Depending on the age of children in your family, education about generational assets should cover a variety of factors. For younger children, this could include plans for college or other career pursuits and an emphasis on taking responsibility with the money that is being provided by the estate. The same is true for adult children, along with extra considerations for aging parents and the challenges of the “sandwich generation.”

Another consideration is the extent to which the estate desires to participate in philanthropic efforts. Establishing a foundation, endowment or other charitable gift – and maintaining it in the years ahead – requires thoughtful discussion and planning. This is particularly true if the younger family members will be charged with maintaining the estate’s philanthropic efforts in the future.

Multi-generational investment planning can be very complex. Risk profiles are dependent on the age and employment status of family members whose needs, income, and expenses are highly variable. Recognizing these inevitable differences is the first step in successfully creating an investment plan that covers everything from a college savings plan to a healthy retirement income and everything in between.


One of the best ways to ensure that a family is on the same page is to enlist the help of a professional advisor who is not only an objective third party, but is also knowledgeable about preserving estates from costly taxes. Advisors also encourage and support open communication and honest discussion about money between family members.

To learn about strategies for managing assets across multiple generations, or for advice regarding your family’s multi-generational financial planning, request a call to speak with a certified advisor at Retirement Advisors of America who can provide guidance based on your unique situation. 

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Disclaimer: This blog is intended for informational purposes only and should not be construed as individual investment advice. Actual recommendations are provided by Retirement Advisors of America following consultation and are custom-tailored to each investor’s unique needs and circumstances. The information contained herein is from sources believed to be accurate and reliable. However, Retirement Advisors of America accepts no legal responsibility for any errors or omissions. Investments in stocks, bonds, and mutual funds may increase or decrease in value. Past performance is no guarantee of future results. Any of the charts and graphs included in this blog are not recommendations for the purchase and sale of any security. 

Topics: Financial Planning