Most Successful Entrepreneurs Have Out Of Date Estate Plans
By: Russ Alan Prince - December 27, 2017
“It is quite possible to zero out all estate taxes. However, such approaches require the formal abrogation of control over selected assets,” says Frank Seneco, president of the advanced planning boutique, Seneco & Associates. “In many cases the use of charitable trusts, for example, makes it possible to eliminate all estate taxes, but the result of such an approach is the transfer of not only wealth but direct control of the assets in question.”
It is important to remember the goal of estate planning is to transfer your wealth in accordance with your wishes. Tax mitigation, while often very important, is not always a critical motivation. The first concern you have is the disposition of your assets, as you would like. The role of your wealth manager is to make it possible for you to achieve your desired agenda and be as tax efficient as possible at the same time.
According to John Bowen, founder of AESNation and author of Becoming Seriously Wealthy, “Based on a survey of 262 successful entrepreneurs, nearly nine out of ten of them have an estate plan, which is defined as having at a minimum a will. However, the estate plans for about 85% of these entrepreneurs are more than five years old. Because of continual changes in the tax laws, estate plans more than a few years old are likely to fail to take maximum advantage of available opportunities.”
Not only do the changes in laws date estate plans. The worlds of successful business owners also require updating an estate plan. Approaching 65% of the successful entrepreneurs reported that they are wealthier since they created their estate plans. The growth of their business is a major contributor to their increased net worth. Also, three-quarters of them say that since they created their estate plans they have experience life changing events. These events can be anything from divorce to the birth of children or grandchildren to the death of prospective guardians, and so forth.
This tells us that for a sizable number of successful entrepreneurs, their estate plans are likely outdated. In order to attain the greatest benefits from estate planning, you need to stay on top of the matter and revise your estate plans when appropriate.
Article source: Forbes.com
** Disclaimer Required by IRS Circular 230** Unless otherwise expressly approved in advance by the undersigned, any discussion of federal tax matters herein is not intended and cannot be used 1) to avoid penalties under the Federal tax laws, or 2) to promote, market or recommend to another party any transaction or tax-related matter addressed.