The Reynolds family*— parents in their 90s and their adult children — turned to RBC Wealth Management for investment advice regarding assets generated by a successful family business. As a result of the influence of an upbringing during the Great Depression, the parents were conservative investors and — at least initially — only took advantage of a limited number of our investment capabilities.
As the father’s health began to fail, he realized how important it was to prepare his loved ones for life without him. He and his family worked very hard to build their wealth and he did not want it eroded by estate taxes. The family had established a trust about 15 years earlier; however they were unaware of the larger estate tax risk and exposure to costly probate proceedings.
An RBC Wealth Management financial advisor and a team of specialists conducted a strategic review of the family’s wealth management needs. The outcome of this meeting was a proactive wealth management plan, including intermediate and future action items.
As a result of the exploration of the family’s needs, the estate planning specialist reviewed the existing trust and provided a checklist of trust mechanisms to create a more favorable outcome. The financial advisor then worked with the family to find a qualified attorney to draft a new trust that was appropriate for their current circumstances and goals.
Additionally, the financial advisor and investment specialist worked with the family’s accountant to explain the tax advantages of properly titling their assets. Finally, they built bond ladders to create an income stream for the heirs.
Because the bond ladders created more income than the heirs needed, the financial advisor educated the heirs about appropriate investment strategies and products for investing the extra cash. So in addition to preparing for an effective and efficient intergenerational transfer of wealth, the adult children of the Reynolds are building, preserving, enjoying – and honoring – the family legacy they will inherit.
* Though the name is fictional to maintain client privacy, this is an actual depiction of a real client story.
As a client, you can count on your financial advisor to: