Safeguarding Your Generational Wealth: 7 Actions to Take Now

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Those who wish to pass wealth to their children and loved ones often have concerns about preserving their assets against inflation and economic changes. While these external factors are out of your control, there are strategies you can use to help ensure your wealth lasts for several generations. At Park Place Financial, we offer heritage wealth planning to guide our valued clients through the complex process of generational wealth management. Here, we discuss seven methods you can use to protect your wealth against various financial risks.

Our Recommended Actions

1. Manage Your Estate

Estate planning is a crucial part of securing your wealth for future generations. This process ensures your assets are allocated to your spouse, children, and other loved ones according to your wishes if you become incapacitated or when you pass away. Although estate planning may seem uncomfortable, it provides you with peace of mind knowing your wealth will be handled by loved ones who truly care about your legacy.

If you have organized your estate already, it’s a good idea to revisit your decisions from time to time as recent modifications to U.S. law and your own life may impact your current plan. If you need help adjusting your estate strategy, a certified financial planner (CFP) can provide guidance.

2. Invest in the Market

Market investments, such as stocks, bonds, municipal funds, and others, can grow for many years, making them an ideal part of a diversified strategy for building long-term generational wealth. You can begin by investing in low-cost index funds as they come with low fees, and then expand your portfolio from there under the guidance of your financial planner.

3. Trust the Next Generation

Unfortunately, it is common for generational wealth to deteriorate when benefactors do not trust their beneficiaries to manage business and family assets properly. As a result, successors may not be given enough exposure to crucial financial matters. This issue is particularly prevalent in family businesses. Including your successors in your wealth management strategy can foster confidence in the upcoming generation and its ability to bring innovative perspectives to your business and assets.

4. Select an Inherited IRA

An inherited or beneficiary individual retirement account (IRA) is another ideal option for preserving generational wealth. With this type of IRA, you can divide assets amongst loved ones and entities, such as charities or your estate. A financial planner can help you create an inherited IRA trust. This document allows you to choose a specific beneficiary who will safeguard your wealth for future generations.

5. Implement a Continuity Plan

If your business is a large chunk of your generational wealth, work with your family to create a continuity plan. This framework will ensure your successors are prepared to assume your role and follow sound standards in making decisions. A continuity plan will also establish how to fill positions as people leave the company, preserving overall longevity and efficiency.

6. Provide Investment Education

Most people do not learn about managing generational wealth in school, making it necessary to educate yourself and teach your heirs how to effectively manage financial resources. Without the proper experience or knowledge, a person who inherits an abundance of wealth may end up depleting it quickly.

7. Turn to a Financial Planner

Despite your best efforts to manage generational wealth, it can be a challenge to preserve your legacy by yourself. Partnering with a CFP can help you establish wealth management goals that suit your needs and desires. They will go over your finances to map out an action-oriented plan for the future and guide you through the various complexities associated with wealth management throughout the process.

Get in Touch with the Wealth Managers at Park Place Financial

If you need help navigating your generational wealth, turn to Park Place Financial. For more information on our generational wealth management services, request a free financial assessment or reach out to us directly for more information.


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