Financial planning may seem like an entirely individual process but it’s important to consider the whole family when saving for the future. After all, individual members’ interests often overlap so, by planning for multiple generations, families can help to ensure that their wealth grows over a longer period of time, securing financial stability for all.
Of course, multi-generation planning does take more effort but by ditching the purely individualized perspective, anyone can place their family on track to future wealth. Kevin Canterbury of Arizona explores a handful of strategies to make this a reality and discusses how financial fitness for one can benefit all.
Start by Considering Family Members’ Current Situations
It’s important to have a clear understanding of each family member’s current financial situation before planning for the future. This will help to ensure that everyone is on the same page and that everyone’s interests are considered. After all, if one member of the family is struggling with debt, it’s going to be difficult to make headway on long-term savings goals.
There are a few key things to look at when assessing each family member’s financial situation, such as:
- How much debt they’re currently struggling with
- Their current income and job status
- Individual spending habits
- Individual long-term financial goals
With a clearer understanding of where everyone stands, you can then start to develop a plan that works for the entire family.
Consider Personal Financial and Business Goals
While it’s important to take a look at each person’s financial situation, it’s also necessary to consider any personal financial goals that they may have. After all, these goals will likely have an impact on the family’s overall financial picture. For example, if one member of the family is hoping to buy a home in the next few years, this will need to be factored into the financial plan.
The same is true of any business goals that family members may have. If someone is hoping to start their own business, this will also have an impact on the family’s finances. So, before establishing a set financial plan for the entire family, it’s important to consider all of these factors.
Consider Estate Planning Well in Advance
Estate planning is an important part of financial planning for the future, but it’s often something that’s put off until later in life. However, to ensure that the family is taken care of financially, it’s important to start estate planning well in advance.
There are a few key things to consider when estate planning, such as:
- Who will inherit any remaining financial assets?
- Who will manage the finances if you become incapacitated?
- Has anything been planned for long-term care?
- Is it possible to minimize estate taxes?
Answering these questions now can help to make the estate planning process much easier for family members in the future.
The Bottom Line
Financial planning for the future doesn’t have to be a purely individual process. In fact, by considering the whole family, you can help to ensure that everyone’s interests are taken into account and that the family’s wealth grows over time. Of course, this does take more effort but it’s well worth it in the long run.