In some ways, managing one’s estate is a lot like managing anything else life – some people will be tempted to oversee every detail (i.e. checking in with their household staff several times a day regarding everything from mundane tasks to the preparations for a dinner party), while others may all but abdicate their role as principal and rely too heavily on their financial advisors. (Still others do both!) The first robs you of valuable time (and likely causes a lot of aggravation for you and those in your employ), and the second robs you of knowledge and therefore agency over your holdings. The key is to strike a balance that allows you to enjoy your wealth in the now while maintaining and growing it for the future. If you are already seeing all the moving parts dancing in your head, here’s the good news: there are relatively simple things you can start doing right now that will drastically reduce the time, energy and uncertainty around managing your estate.
Take stock of your physical assets: This goes beyond things we see and use regularly, such as homes and cars, to collections and/or inherited items we may have stashed away in basements, rarely used rooms, or safety deposit boxes. While cataloguing them may seem like an arduous task, it will save you (and potentially your heirs) a lot of time and money in the long run. You may even find it enjoyable, especially if your siblings, children or other loved ones can help you walk down memory lane. That said, you should also engage professionals to assess the value and assist with any necessary maintenance.
Utilize (rather than rely on) your financial planner(s). For some, this step will mean homework and perhaps a learning curve. Fortunately, it doesn’t necessarily require wading through stacks of financials. As we’ve covered in a previous post, the trend in estate planning is leaning toward graphics and other visuals that enable you to take in critical information at little more than a glance. The goal here is to be able to make decisions based on your own knowledge and instincts, and communicate that knowledge to other stakeholders.
Hire the right household staff: As mentioned above, micromanaging is no fun for anyone. That said, you want to make sure the people working for you have not only the requisite experience and expertise but are aligned with the way you like things done. The ideal candidate is someone with a stellar work ethic who you can also trust like family.
Embrace technology: This could be as simple as storing information about your assets on a cloud; however, if you are really ready to take the reins, estate management apps are the way to go. They allow twenty-four seven access to all your holdings on your smartphone or other device. You can also share valuable information, as well as work schedules, with your staff, advisors, and other trusted parties. Even the most tech-averse people will find these apps to be a game-changer.
Talk to your kids. This is the most important by far. As the saying goes, “shirtsleeves to shirtsleeves in three generations” – meaning even vast fortunes tend to disappear by the time one’s great-grandchildren come of age. While each family has its own dynamic, it all comes down to communication, or lack thereof, between principals and their heirs. This breakdown can occur for any number of reasons, but it is always incumbent upon the principal to educate future generations about their wealth and how to manage it moving forward.
As you can see, efficiently managing your estate means both the releasing control and, when appropriate, taking more of it. To learn more about how technology can help you do this, visit EstateSpace.com