For many people, especially those with family-owned businesses that have been in the family for generations, estate planning is more than just about choosing how you wish to pass your property on after you die. It’s also about ensuring that your family will be able to maintain the business and keep a positive relationship with wealth so that they can keep the family legacy strong. People in this kind of situation will want to focus on dynasty planning as a key part of their estate plans.
Dynasty planning is something that looks far down the road, often taking into consideration what future generations will have to do to maintain the family legacy. While it includes specific estate planning tools, such as dynasty trusts or other types of instruments, it also has to recognize the importance of imparting values and habits that will allow future generations to develop a healthy relationship with wealth.
It’s all too common for people who inherit a lot of money to, if not squander it, fail to manage it responsibly. A dynasty plan seeks to instill the values and work ethic in those who receive wealth instead of creating it for themselves. This is often very difficult to do, especially when that wealth comes from parents who made it on their own. It can be very hard for such parents to recognize that growing up in an environment where the children want for nothing is a very different experience than the one that the parents themselves had while growing up. Dynasty planning recognizes that problem and takes steps to deal with it.
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