How does multigenerational planning work?

Bryson Roof in Wealth Management 5 January, 2021

With changing family dynamics across generations, financial plans should focus on the goals and intentions of individuals, couples, or families. Families are more interconnected now than ever, and multiple generations are important to consider when creating a plan and legacy. Wondering what multigenerational planning looks like? Here’s a sample of different ways we assist families across multiple generations. 

The “core” client

Many of our clients are in the sandwich generation, between 50 and 65 years old. The term was coined because they are “sandwiched” between adult or young adult children and their own aging parents. They have their own financial needs and goals for retirement planning but also are tasked with helping children with either college plans or post-college financial planning. In addition, they are also worried about their aging parents and have elder care planning issues to consider. 

Millennial children

Parents’ main mission is to make sure their kids are happy and healthy. Beyond that, they want them to be financially OK. We often work with our client’s adult children navigating a lot of “firsts” from post-college decisions on if they should live at home, rent, or buy a place to live, how to save and invest, how to approach student loan payments, etc. The list goes on, but we’re here to help make a smoother transition into the “real world.” And once this generation has their own first child, they want to start planning for their kids’ future, just like their parents did for them. 

We often meet with our client’s children one-on-one, but we also have discussions about their parents’ involvement. Sometimes parents want to be involved in helping navigate the process or parents may want their children to know what the entire family’s finances look like to get a full view of what’s going on. We approach intergenerational planning in whatever way makes both parties comfortable so everyone can walk away confident in their future plans. 

Aging partners 

When the “core” client comes to us, their parents may not have a specific advisor in place, or they don’t feel they are getting the type of advice their parents need for eldercare planning. This can be for long-term care facilities, to funding a charitable trust, or help with Medicare or Medicaid. 

It can be difficult and emotional to make long-term planning decisions. Whether the grandparent generation goes into independent living to skilled care or hospice, it can be expensive and is important to plan for. Many want to make sure they can protect assets for their children and grandchildren while meeting their own needs. We often coordinate with attorneys and accountants to achieve different objectives set forth. 

Creating a legacy

Through working with each generation, we have multidimensional planning conversations, which can lead to discussing a legacy. We often help open charitable trusts, but once you make donations you have an obligation to continue giving the gift after you pass on. This means you either have to name a child as a successor or have the trust terminate at your death and payout to charity. Bringing children into the conversation can help to educate them on charitable gifting and creating a legacy. 

We often see clients prefer children to continue the legacy of gifting. It’s a nice way to educate their children about what’s important to them. And we often hear from the children that they want to continue the good work the parents did. 

If you’re interested in speaking with an advisor about planning across multiple generations, please contact us.

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