Legacy Letters: Ensuring Your Legacy Goes Beyond the Money

June 27, 2019

As we guide our clients through the various aspects of estate planning, we are in a position to help people define their legacy and transfer assets to future generations. These are often difficult times of change and transition, and we remind our clients that estate planning is about more than distributing wealth – it is also an opportunity to pass on your wisdom and values. 

Each generational transition is as unique as the family involved, but through our work with families we have seen some universal themes surface. One is that we find heirs often wish they knew more ahead of time about the process, or how to handle the range of resulting emotions—guilt, doubt, gratefulness—and to be more prepared to comfortably step into the responsibility of managing new wealth.  

Another theme is that receiving an inheritance can be both a blessing and a burden. We find that at some point in the process, heirs struggle with how to best follow their loved ones’ wishes as they begin the stewardship of family wealth. They may search for clues about what their loved one might have wanted them to do with this newfound responsibility, and they can experience difficulty in decision making.   

One way we encourage our clients to help alleviate this weight for their heirs is to write a legacy letter to include with estate plans and documents. Legacy letters are informal documents that offer thoughts ranging from reminders of personal or money values, words of encouragement, and transfer knowledge and wisdom. In this way, these letter help leave a family legacy that transcends money or property, and can be just as, or even more valuable.  

Writing A Legacy Letter Is A Gift To Loved Ones

Although they may lack the legal force of a will or trust document, legacy letters provide an understanding of your hopes and wishes for your heirs as they receive the benefit of your financial legacy.  The letter can be as short as a few paragraphs, or any length that is needed to cover important issues. They can be hand-written, or electronic, or even in video. In all cases, legacy letters can be living documents that are amended over time. 

Among other things, writing a letter to heirs can help 

  • communicate hopes and wishes for how a legacy can be carried on 
  • explain how and why estate decisions were made 
  • ensure beneficiaries are all on the same page, reducing the risk of future conflict 
  • offer valuable guidance in areas such as how to approach certain decisions concerning a family member, a charitable account or foundation, or a multigenerational business 
  • transmit values—whether they relate to family, money, or philanthropy 
  • express gratitude and love and share family storiesrelay life lessons learned 

To many of our clients, the idea of creating a legacy letter is intuitively appealing because it can go further than a legal document in providing clarity and comfort.  

In our work to support the financial and legal aspects of estate planning for our clients—including facilitating family meetings and connecting helpful resources—our advisory team can help answer the “who, what, and how.” But in our experience, communicating the “why” behind these decisions is what really provides peace of mind, and that makes it a vital step in caring for your heirs. 

If you have any questions or would like to discuss legacy planning or legacy letters, please call your Litman Gregory Wealth Advisor or contact us here. 

 

The information contained herein does not provide investment advice, should not be construed as personalized investment advice and is not an offer to sell a security or a solicitation of an offer, or a recommendation, to buy or sell a security. The statements, information, and opinions contained herein are solely those of Litman Gregory Asset Management, LLC and are subject to change without notice. There is no agreement or understanding that Litman Gregory Asset Management, LLC will provide individual advice to any investor or advisor client in receipt of this document. Investments in securities involve the risk of loss and may not be suitable for all investors. Past performance is no guarantee of future results. For additional information about Litman Gregory Asset Management, LLC, please consult the firm’s form ADV disclosure documents, the most recent versions of which are available on the SEC’s investment adviser public disclosure website (www.adviserinfo.sec.gov) and may otherwise be made available upon written request.