What do you want people to say about you after you are gone? We all want to lead a life worth remembering, but creating a lasting legacy is about more than just money — but it’s the monetary aspect that requires careful attention and planning.
“No matter the size, leaving an inheritance behind for your loved ones gives you the comfort in knowing that your family is in good hands,” says Patricia Lovett-Reid, Senior Vice President, TD Waterhouse. “But leaving a legacy that is sustainable has many considerations that should be built into retirement plans early.” Lovett-Reid offers the following tips:
Manage your estate
One of the biggest challenges to creating a sustainable legacy is the tax implications upon death. Speak with an expert who will help you determine the best strategy for your personal situation. One of the first things is to designate a beneficiary for your registered accounts which allows your Registered Retirement Savings Plan (RSP) or Registered Retirement Income Fund (RIF) to pass directly to the chosen person, in most provinces. (The exception is Quebec). If you own property outside your principle place of residence, learn about the implications of capital gains tax and ensure your beneficiaries also understand.
Share your wishes
The key to creating a sustainable legacy is ensuring that your family understands your wishes. Have “the talk” with your family about what you would like to have happen once you are gone – share what is important to you and explain how and why you have made the decisions you have. This eliminates all of the second guessing and ensures your legacy is in fact YOUR legacy.
Instill your values
An important aspect to creating a legacy is philanthropy. Make it a family affair by instilling values in your children about the importance of giving back, which can be financial, but it can also be a donation of your time. Consider volunteering as a way to share your expertise. Set an example for your children that they can follow throughout their lifetimes.
Information about planning a legacy is available at www.tdretirement.com.