Wealth is passed on across generations. This process of intergenerational transfer not only involves legal aspects with respect to entitlements under personal law, but also documentation and processes that will enable a smooth transition of wealth in a tax-efficient way.
Estate planning refers to all those activities that are focussed on transfer of wealth to heirs, charity, and other identified beneficiaries. There are several tools and structures to choose from, in estate planning.
Some choices such as gifts can be exercised during one’s lifetime, while choices such as wills come into play after death.
We at Financial Gainers help households make these choices after considering all the implications, and help them complete the legal and documentation processes efficiently
Estate planning refers to the organized approach to managing the accumulated assets of a person in the interest of the intended beneficiaries. Wealth may be accumulated with a specific purpose of being passed on to heirs, to charity, or to any other intended purpose.
Without formal structures that ensure that these purposes are met, there could be disputes, conflicting claims, legal battles, avoidable taxes and unstructured pay-offs that may not be in the best interest of the beneficiaries.
Estate planning covers the structural, financial, legal and tax aspects of managing wealth in the interest of the intended beneficiaries.
Estate planning involves the following broad set of activities:
- Identifying the beneficiaries and their claim to the estate through a comprehensive documentation such as the legal Will.
- Creating tax-efficient structures such as trusts to manage the estate and make periodic payouts to beneficiaries.
- Creating organizational structures including trustees, executors, guardians, power of attorney to perform identified functions in administering, protecting and managing the estate.