How to Transfer Wealth to the Next Generation


By Jeremy Frazie, AIF®, PPC®


Imagine the day that we can rest easy knowing that they’ll become financially wise enough to grow our life’s earnings into something bigger than ourselves. No matter what you decide to do, there’s nothing wrong with weighing your options and figuring out how you want your legacy to stand after you’re gone.


You might be protecting your assets in the best possible way now, but what happens after it’s transferred? Does it bear the burden of taxes? Can it be affected by creditors? Your estate may be protected when it’s in your hands, but will that continue once in your heir’s possession?


You may wonder how to transfer your wealth to your loved ones without losing significant portions to taxes. It’s a complicated process, but there are ways to keep it simple while leaving a legacy you can be proud of. Below, we explore ways to transfer wealth to the next generation.


Make Direct Payments

This is one of the easiest ways to transfer your wealth without the hassle of taxes. You could simply make direct payments to your children or grandchildren. Many institutions will allow you to pay your grandchildren’s tuition directly from your account. You can also conveniently take care of your priorities, such as medical expenses, by automating payments to your healthcare provider.


When you make this sort of payment to an organization or institution, it helps you bypass the burden of gift tax, which can be a hefty price to pay on your assets. However, if you gift it directly to the recipient, you might still be subject to gift taxes.


Give Annual Gifts

You could also decide to gift some of your assets to your loved ones. Giving gifts helps you reduce the