Do You Have An Estate Plan?

The Most Important Financial Plan You May Never Use: The Power of Estate Planning

When most people think about financial planning, they think about retirement.

How much do I need? Am I invested correctly? When can I stop working? How much can I spend?

Those are important questions. But there is another part of financial planning that people tend to push to the back of the line because it feels less urgent.

Estate planning.

And that is a mistake.

Because the real power of estate planning isn’t necessarily what it does for you while you’re alive. It’s what it does for the people you love when you’re no longer around to make the decisions yourself.

You Don’t Get to Choose When the Plan Is Needed

One of the biggest problems with estate planning is psychological.

Nobody wakes up in the morning thinking, “Today might be a good day to figure out what happens to everything I own when I die.”

We tend to think estate planning is something we will get around to eventually.

When the kids are older.

When we have more money.

When we retire.

When we have more time.

But life doesn’t operate on our preferred timeline.

And the larger your financial life becomes, the more complicated the consequences of not having a plan can become.

You can spend 30 years carefully building a retirement portfolio, buying real estate, accumulating businesses, saving for your children and creating wealth — and then have no clear plan for what happens to it.

That’s not really a complete financial plan.

It’s accumulation without a destination.

Estate Planning Is About More Than Death

This is where I think people misunderstand estate planning.

They hear “estate plan” and immediately think about a will.

A will is important, but estate planning can be much bigger than that.

It’s about answering questions such as:

Who makes financial decisions for me if I can’t?

Who makes healthcare decisions for me?

Who receives my assets?

When do they receive them?

What happens if my children are minors?

What happens if one of my children has financial problems, gets divorced or has creditor issues?

What happens to a family business?

How do my retirement accounts transfer?

Are my beneficiary designations actually correct?

How much unnecessary tax could my family face?

What happens to my charitable intentions?

These aren’t theoretical questions.

They’re real-life problems.

And one of the most valuable things a financial advisor can do is help identify those problems before they become emergencies.

Your Beneficiary Form Might Be More Important Than You Think

Here’s a simple example.

Someone gets married, has children, builds a retirement account and names beneficiaries when they’re 30 years old.

Twenty years go by.

Maybe there’s been a divorce, remarriage, children have grown up, grandchildren have been born or family circumstances have changed.

But nobody updates the beneficiary designation.

The estate plan may say one thing while the beneficiary designation says another.

That’s why estate planning isn’t a “set it and forget it” exercise.

Your life changes.

Your financial plan needs to change with it.

This is also why estate planning should be coordinated with your investment and retirement planning. You don’t want five different pieces of your financial life operating independently.

You want them working together.

The Goal Isn’t to Die With the Most Money

This is one of the biggest misconceptions I see in financial planning.

People sometimes become obsessed with maximizing the size of their estate.

But the goal shouldn’t necessarily be to die with the largest possible number.

The goal is to use your wealth intentionally.

Maybe that means leaving money to your children.

Maybe it’s helping grandchildren pay for college.

Maybe it’s supporting a charity that means something deeply personal to your family.

Maybe it’s transferring a business.

Maybe it’s giving money away during your lifetime so you can actually see the impact it has.

There is no universal right answer.

That’s the point.

Your money should reflect your values.

Estate planning gives you the ability to make those decisions intentionally instead of leaving them for a court, a tax bill or your family to figure out later.

Estate Planning Can Prevent Family Problems

Money doesn’t always bring families together.

Sometimes it exposes the cracks that were already there.

I’ve seen enough financial situations to know that the biggest estate-planning problem isn’t always taxes.

Sometimes it’s confusion.

Who gets what?

Who is in charge?

Who has the authority to make decisions?

What did Mom and Dad actually want?

Why did one child get this and another get that?

Those questions can create resentment that lasts for years.

A thoughtful estate plan can remove a lot of that uncertainty.

It can make your wishes clear.

And sometimes the greatest gift you can leave your family isn’t another dollar.

It’s clarity.

Estate Planning Is Financial Planning

This is why I believe estate planning shouldn’t be treated as a separate conversation that happens once every 10 years with an attorney.

Your attorney is incredibly important. Your CPA is incredibly important. Your financial advisor is incredibly important.

But these pieces need to communicate.

Your estate plan should make sense alongside your investments, retirement accounts, tax strategy, insurance, charitable giving and overall financial goals.

Think about your financial life like a business.

You wouldn’t run a business where the accounting department, operations department and sales department never speak to each other.

Your household shouldn’t operate that way either.

Your financial life is a system.

Estate planning is one of the most important parts of that system.

Don’t Wait Until You Have a “Big Enough” Estate

Another reason people procrastinate is because they think estate planning is only for wealthy people.

It isn’t.

If you own a home, have retirement accounts, have children, have a life insurance policy, have a business or simply have wishes about who should make decisions for you, estate planning matters.

You don’t have to be worth $10 million to need an estate plan.

In fact, having less wealth can sometimes make proper planning even more important because there is less room for mistakes.

The Best Estate Plan Is One Your Family Can Actually Understand

A good estate plan isn’t just a pile of legal documents sitting in a safe.

Your family should know where important documents are.

They should know who to contact.

Your financial advisor should know who the appropriate professionals are.

Beneficiary designations should be reviewed.

Accounts should be coordinated.

And your plan should be revisited when major life events occur.

Marriage.

Divorce.

Birth of a child.

Death in the family.

Inheritance.

Sale of a business.

Retirement.

Major change in wealth.

Those are all reasons to revisit the plan.

The Real Power of Estate Planning

I think financial planning is ultimately about solving problems before they become problems.

Estate planning is one of the clearest examples of that.

You may never personally experience the full benefit of the plan you put in place.

And that’s exactly why it matters.

You’re creating a roadmap for the people you love.

You’re making decisions while you’re capable of making them.

You’re protecting the wealth you’ve spent decades building.

You’re reducing uncertainty.

And you’re making sure your money has a purpose beyond simply accumulating a bigger number on a statement.

That’s what good financial planning should do.

Build wealth with a purpose. Protect it. And make sure it ends up where you intended.

Because the ultimate measure of a financial plan isn’t simply how much money you accumulate.

It’s whether that money accomplishes what you wanted it to accomplish — for you, your family and the causes you care about.

That’s how you dream bigger, sleep better and make your wealth work smarter.

Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

Colin Symons, CIO Lloyd Financial Group

The latest market worry is from weekend statements by the CEOs of Anthropic and OpenAI calling for a slowdown in the pace of AI development. This has AI names down fairly steeply. There are plenty of interpretations for why these statements came out and let’s go over a few.

Is the pace of development so fast that humanity is now in danger? That seems unlikely, as what has actually happened of late that suddenly makes AI seem more dangerous? That also doesn’t solve the problem that other entities, such as China, would just take the lead in AI development if US companies made the decision to slow.

Another simple, but also negative, thought is that progress is slowing and this creates cover for that problem. It’s not that AI improvement is slowing, it’s that we voluntarily slowed. It’s true you can search online and find people complaining about the latest models, but that always seems true to one extent or another. While this idea may be bad for the frontier labs, I’m not sure it has as much effect on the hyperscalers, like Google (GOOGL,) who lack the incentive to slow development.

It’s also worth noting Anthropic is working on an IPO. Is taking a loud, public stance a PR move? If nothing else, it certainly attracted a lot of attention. We also have midterms coming and different politicians have been making positive and negative comments about AI. Are they looking to drive direction on the development of any AI laws?

Similarly, regulation has been used in other businesses as an arbitrage opportunity. The big guys both can pay for the regulation and know the regulators, while the smaller guys have a harder time affording the costs and are less well known. This ultimately, helps the big companies stay big and reduces competition.

Do we really think these CEOs are acting for society’s benefit or their own self-interest? Human nature, and their past actions, indicate the latter is more likely. This sudden push towards sainthood should smell funny, it’s just a question of divining the biggest motivation. I think getting ahead of regulation is the most likely.

I’m not a massive fan of chip stocks, but the idea they should be sold on this strikes me as silly and is likely to be short-lived. I view this AI panic as unlikely to last. The bigger problems are in rates, and I think that’s what’s really driving these moves. Rate stress is pushing panic, and right now that panic is most felt in the AI space. In theory, this call to slow growth could help rates to calm down.

Ultimately, AI will still be used and will still grow. The AI race isn’t suddenly going to stop because of what looks like political maneuvering, particularly as it doesn’t seem to have the broad support of the federal government. It could change the shape of that buildout, though. We’ll see what happens, particularly with the rate picture as we move through FOMC.

Bitcoin was up almost 3% yesterday as the Senate is set to vote on the Clarity Act today. It’s sliding 1% today as odds of passage fall back.

Markets got a boost yesterday after more talk of an Iran deal, though Iran denied it. Oil is up 2% though still a little off highs of the last week.

Bank of America (BAC) was -5% after the CEO said Q3 sales and trading were relatively flat vs. last year.

FOMC meeting begins today, along with Empire State Manufacturing and ADP Employment.

Bottom line: Rates continue to push up as we approach the FOMC meeting.

Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

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