What is a family financial plan?

Many of our millionaire clients see the benefits of doing some financial planning as an extended family. This means that parents, their adult children and in some cases adult grandchildren are all clients in their own right. As their financial planners we would know the financial circumstances, plans and objectives of both parents and their adult children in detail.

What are the benefits of this in practice?

All parts of the family group’s circumstances are taken into account when giving financial advice and personal tax planning advice to either parents or children. For instance:

• There may be little point in saving large amounts in pension plans for someone currently working who can reasonably expect their parents to avoid inheritance tax and inherit a large amount of money tax free. Maybe using the best ISAs would be better planning
• Grandparent’s can help fund their grandchildren’s school fees or university fees very tax efficiently. This can help build the children’s assets more efficiently too
• Investment portfolios and other assets can be protected using family trusts through generations against tax, divorce or bankruptcy
• Tax planning together can utilise more tax allowances provided assets are properly protected
• In some cases the parents even pay for their children’s annual meetings to ensure they are planning properly

Unfortunately in many families, money is frittered away due to bad planning in only two generations. A good financial education for all members of an extended and wealthy family together with careful tax planning is essential.

How is a family financial plan established?

Once both parents and children are clients in their own right we plan in exactly the same way as a personal financial plan. The only addition being that after setting up the financial plan for the parent’s we hold an additional meeting with the adult children to discuss the parent’s financial plan but not necessarily all the details with them. We can then discuss the implications on the adult children’s financial plans separately.

Any questions on a family financial plan?

Please call us on 01582 839280 or Email us.