Deciding how to distribute your estate depends on who your beneficiaries are and the kind of legacy you wish to leave behind. Exploring all your options can help you choose one that is complementary to your lifestyle and your end of life wishes.
One option you can consider is to gift some of your estate to your beneficiaries while you are still living.
A win-win solution
Have you ever wondered how your heirs will use the assets you give to them? Gifting them a portion while you are still living allows you to see how they choose to use that money. Under your watch, they may feel motivated to manage it wisely to honor your legacy.
According to RBC Wealth Management, among the most common benefits of gifting while living, is the chance to reduce estate taxes. Receiving the money directly from you allows your benefactors to accept your offer tax free. Additionally, they have the freedom to determine how they wish to use the money you give to them. Other methods of gifting while living include charitable donations, contributing to education funds and donating to a family member’s medical treatment.
Protecting your future
Before you decide to start gifting a portion of your estate, verify that you have enough cashflow to sustain your lifestyle. Through careful planning and proactive saving, you can effectively manage your money to meet your own needs while still gifting some money to your heirs each year. If at any point you need to suspend gifts to your heirs to afford your own needs, you have the flexibility to forgo contributions until you can afford them once more.
If you wish to learn more about planning your estate, please visit our webpage.