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Most children learn the ins and outs of responsible wealth-building from their parents. As kids grow, simple conversations about saving and spending often branch out into investing, compounding, and comprehensive Life-Centred Planning. But no matter how many good financial habits your children have learned by adulthood, they could still be unprepared for their role in your legacy plan.

Talking to your adult children about inheriting your wealth might be awkward at first. But if you work through this six-part framework you’ll all feel better about your wishes, your kids’ responsibilities, and your family’s Return on Life.

Review your estate plan.

While you’re still around to change it, your estate plan is never set in stone. Every year, sit down with your financial adviser and solicitor to make sure you’re still happy with your beneficiaries, your health care directives, and the allocation of your assets. You’re under no obligation to share every aspect of your finances and health with your children. But the more you tell them about your legacy plan now, the easier it will be for them to care for you and settle your affairs when the time comes.

Consider the impact on your heirs.

Money impacts different people very differently. Inheriting a portion of your legacy could be life-changing for one of your children. Another might not experience much of a change at all. Encourage your children to put together their own team of financial, tax, and legal professionals who will help them make the best use of their inheritance with the least amount of hassle.

Promote responsible behavior.

You may feel like you have no choice but to leave some of your wealth to an adult child who doesn’t have the best financial habits. However, it is possible to establish guardrails, such as a family trust that releases money under certain conditions that you establish in your legacy plan.

Even the most responsible children might not be capable of managing a company, real estate, or an art collection. Talk to your children about how their abilities and goals fit with how you want more complicated assets to be managed.

Set realistic expectations.

Your children likely have ideas about your wealth and expectations for what they will inherit. Have an honest conversation that will help them recalibrate those expectations properly. You don’t want your kids to plan for a life of luxury that you won’t be leaving to them. But if they’re set to inherit more than they realize, you also don’t want them planning for a too-frugal future lacking certain experiences and comforts.

Shore up your plan.

By now you have identified some strengths and weaknesses in both your legacy plan and your children’s financial skills. Use this information to plan for improvements. Talk to your financial team about vehicles that can protect certain assets and encourage responsible stewardship. Assign an appropriate executor who will oversee your estate. Work with your children on a plan to develop the knowledge and skills they’ll need to manage more complicated assets. Identify potential mentors whom you can trust to guide your children after you’re gone.

Clarify your intentions.

Sometimes the assets in an estate plan get in the way of the real purpose of the estate plan. You aren’t just passing on stuff – you’re passing on values, experiences, and the means to do more with money than just have more money.

Tell your children what you hope they’ll do with your legacy, not just to make their own lives better but to make life better for their own families, friends, and communities. If you’ve made choices in your legacy plan that might be difficult for your kids to accept, explain your reasoning and your intentions. If you can’t reach a place of agreement, at least try to reach a place of understanding and mutual respect.

And if you need help facilitating these conversations, consider bringing your children into our office for a meeting. We’re always happy to help families prepare for legacy events that preserve and respect what matters most.

When you’re a new retiree, staring at that blank page where your work schedule used to be, time might seem so abundant that you forget just how valuable it really is. But if you treat retirement like an endless weekend, you might be surprised to look up in a month, a year, or a couple years, and realize you don’t feel as fulfilled as you thought you’d be. All those hours puttering around the house might suddenly feel like a precious resource you’ve wasted.

Being a good steward of your time is a skill that will only become more important as you progress in retirement. Here are some ideas to help you manage your days with a sense of purpose and contentment that will improve your “Return on Life”.

1. Create a new daily routine.

You’re going to love those first few days without an alarm clock rushing you towards your work commute. But your days are going to start lumping together into a repetitive blah without structure and purpose.

Your new retirement routine doesn’t have to be as rigid as your old working one. The goal should be to create a flexible routine that gives you time for a variety of activities, both alone and with the people you love. Start by adding some simple anchor activities, like a morning walk or an afternoon cup of coffee with your neighbor. Then block of time for your favorite hobbies, like a Friday morning round of golf or a weekly trip to the library. As your schedule starts to fill up, you’ll gain a clearer perspective on how much time you have, how you’re using it, and how to use it better.

2. Prioritise your passions.

When you were working and raising a family, it’s likely that you had to put your hobbies and interests to the side as you focused on other responsibilities. In retirement, you can give those passions a more prominent place on your schedule. Work with a coach to get better at your favourite sport and enjoy the games you love even more. Devote more time to your favourite craft and turn hobbies into real skills. Take weekly volunteer positions with organisations that are making a difference in your community. Start scheduling all the bucket list trips you’ve delayed over the years. Or develop that business idea that’s been incubating for your whole career into a new company that you can lead as CEO.

3. Nurture your relationships.

The more people you share your time with in retirement, the more rewarding your retirement is going to be. Set aside time in your new schedule to deepen your connections to your friends and family. Call up retired friends and your old colleagues and schedule some lunch dates. Get your old foursome back together on the weekends. See if your grandkids need a volunteer coach or a tutor. Mentor the next generation of professionals who are just starting out in your field. If you’re married, sit down with your spouse and discuss how both of you are envisioning an ideal retirement: the things you want to do together, and the individual passions you want to pursue separately. Stop putting off the big vacations that never fit into your work schedule and treat your whole family to a dream trip.

4. Leave room to experiment.

Most successful retirees will tell you that retirement isn’t a one-time life transition: it’s an ongoing process that you will refine over time. Allow for some trial and error. Take chances on new opportunities and new experiences. Spend some time doing things you’ve never dreamed of trying and you might find that your retirement is more full of promise and possibility than you ever realized.

Let’s meet to discuss how our Life-Centered Planning process and interactive tools can help you get more out of your time and your money in retirement.

“I want them to not only do what’s legal obviously, but I want them to judge every action by how it would appear on the front page of their local paper.” (Warren Buffett)

That’s master investor and CEO Warren Buffett describing how he wants his 330,000 employees at Berkshire Hathaway to work every day.

Imagining how your own life would look on the printed page can be a helpful exercise when you’re building a Life-Centred Financial Plan. After all, the purpose of a financial plan isn’t just to earn more money. It’s to grow assets that help you live a life that fulfills you and that you’re proud of.

As you think about the story of your life, ask yourself these three questions to reflect on what’s happened so far and to write an inspiring rough draft of the chapters ahead.

1. What goals have I achieved?

A legacy filled with positive stories doesn’t just happen. The happiest and most successful people are often those who live their lives the most intentionally. Rather than waiting around for life to happen to them, they dream big, set goals, and work hard every day to make progress.

If you want to be thought of as a consistently high achiever, start out small. Identify one or two goals you’d like to achieve in six months to a year that build towards bigger overall goals. Then, break down those goals into daily actionable steps.

The great thing about this technique is that you can apply it to just about any aspect of your life. Long-term financial goals might start with a brown bag lunch three days per week and increasing monthly contributions to your retirement accounts. A fitness goal might start with taking a long walk every morning. And creating your own dream company might start with an online class you take to learn a new skill or earn a new certification.

2. How did I learn from the mistakes I made?

No person’s life journey avoids every bump in the road. There were, and perhaps will be, times when you make the easy choice instead of the right choice. You’ll do things that hurt others or embarrass yourself. A big business swing could come up empty. You might lose perspective and place your friends and family behind things that aren’t as important.

Try to accept that these kinds of mistakes are a given. But will you let these errors define your life? Or do you want people to remember how you responded, rebounded, made amends, course corrected, and came out the other side a better, more thoughtful, more caring person? When you’re looking back on your life decades from now, these stories of learning and growth will be far more important than the stumbles along the way.

3. How did I impact others?

Many people don’t start thinking about their legacy planning until they’re retired and nearing the end of their lives. But your legacy is bigger than what you bequeath in your last will and testament. Your legacy is defined by the actions you take and the choices you make every single day.

You may not love everything about your job. But you can choose to show up every morning with a smile on your face and to treat every coworker and customer with kindness. You may not be rich, but the weekend volunteer shifts you put in at your local food bank will make life easier for folks who are in need. You may never achieve perfect work-life balance. But your family will always remember the summers when you coached the kids’ soccer teams or carved out enough free time to take that big family vacation.

Again, authoring these kinds of life stories doesn’t just happen. Living your best life possible with the money you have is a process that combines long-term vision with intentional planning. If you need help writing your next chapter, please get in touch and we can talk about our Life-Centreed Planning process, your life, your goals, and your legacy.

The unexpected events of the past few years, have made financial protection a front of mind matter for most Australians. Now more than ever we appreciate that life does not always go the way we plan. Having a plan in place if things do take an unexpected turn can mean that our health, lifestyle and family are better protected.

If you don’t have any type of personal insurance cover, or you have not reviewed it with your Financial Adviser for a while, now is a good time to do so.

Types of insurance

There are a few different types of insurance that you should consider, based on what matters to you and what you would most like protected if you were to suffer illness, injury, disablement or premature death. It’s best to discuss insurance options with your Financial Adviser as they can tell you what different types of insurance policies are available, what they cover, and how to structure them in your overall financial plan, based on your individual situation and goals.

The types of insurance policies you may discuss are:

• Life insurance
• Total and Permanent Disablement insurance
• Critical illness insurance also called Trauma cover
• Income Protection insurance.
• The benefits of an insurance policy

Family first

You and your loved ones count on your income to enjoy a certain standard of living, which is why insurance is particularly important if you have dependents. It means the people who matter most in your life are protected from financial hardship if your income stopped.

Less stress

Profound unforeseen illness, injury, permanent disability, and death –are not nice to think about but these events happen. If it happened to your family it would probably be an extremely challenging time, wrought with emotional stress, and even grief. With personal insurance in place, the financial stress can be reduced, allowing you to focus on getting well, and rebuilding your life.

Financial security

Illness, injury and disablement do not come cheap. If you needed funds to recover from illness or injury would you have enough disposable income to cover medical bills whilst still paying your household expenses? Could you modify the home if need be? Would you want access to the best medical cover, treatments and rehabilitation options?

Insurance provides financial security so your life can continue with as much normalcy as possible, whilst you seek the best care available.

At a time when everything else seems out of control, it is good to know your financial security isn’t!

The difference a Financial Adviser can make

Data collected by APRA found that in the case of Total & Permanent Disability cover, the “claim declined” rate was around double  for claimants who arranged their cover direct with the insurer than for claimants who went through an adviser. In other words, you have a much greater chance of success with an adviser.[1]

A Financial Adviser looks at your specific circumstances, your lifestyle, goals and appetite to risk. Together you can discuss personal insurance policies, tapping into their expert knowledge and understanding of the requirements of insurance providers. You can also discuss options for holding insurance inside and outside of superannuation and, should you need to make a claim on a policy, your Financial Adviser can liaise with insurance companies and superannuation entities on your behalf as your advocate.

If it’s time to consider personal insurance cover , or you want to review your existing policy, a Financial Adviser is willing and able to assist you.

Note:
[1] APRA: Life insurance Claims and Disputes Statistics, June 2021 (issued 19 October 2021)

It can be difficult to picture yourself without a 9-to-5 job, even if part of that picture involves a beach-house or daily tee times. Where some retirees see carefree days and endless possibilities, you might be staring at a blank calendar worried that you’re going to go crazy without meetings, deadlines, and tasks that fill you with purpose.

Answering these three questions will help you start to fill in those blanks and rethink what your retirement can be.

What does my ideal week look like?

Grab a calendar or a sheet of paper and divide every day of the week into three sections: Morning, Afternoon, and Night. Then, put at least one activity in every box. These don’t have to be bucket list items. Start small. Schedule a post-breakfast walk with your spouse on Monday, Wednesday, and Friday mornings. Reserve some afternoon time for reading. Find out when your retired friends are free and book a weekly dinner or some time on the tennis court.

Eventually, your daily boxes are going to fill up faster than you might expect. Even better, because you’ve put these items on a schedule, you’ll be much more likely to go out and do them. Retirees who spend their days on the couch muttering, “I’ll get to that,” often don’t. The more intentional you are with your time, the more successful your retirement is likely to be.

What have I observed about other retirees?

Although the classic image of retirement is a life of financial security and leisure, many of us have seen a less positive side of retirement as well. If your parents started arguing more once dad retired or if one of your newly retired friends is having money problems, you might worry that your own retirement is going to be less of an extended vacation and more of an endless worry.

Take a piece of paper and divide it in half. On one side, write down all of the things you’ve observed from people whom you consider successful retirees. How do those folks spend their time? Did they stay in the family home or move someplace new? What are their relationships like? What hobbies do they enjoy? How have they strengthened their connections to their communities?

On the other side of the paper, write down the things you’ve observed from less successful retirees. What words would you use to describe their mindsets and emotions? Do they seem intellectually stimulated? Are they in good health? Do they get the support they need from their social networks?

When you’ve finished with your lists, you should have a clearer picture of what kinds of attitudes and habits you want to incorporate into your own retirement and some potential pitfalls to avoid.

What’s really important to me?

Even people who love their jobs rarely love working. They love the way that their jobs allow them to put their top skills to good use, the opportunities for creativity and self-expression, the feeling that they’re contributing to society, and the bonds they build with other people. They also appreciate how their hard work provides a happier and more fulfilling life for them and the people they love the most.

Make a list of all the ways that your career has brought out the best in you and allowed you to put your values in action. Then, add in the people you want to spend your time with in retirement, the places you want to go, the things you want to do. Look over your complete list and you’ll start making some surprising connections that could lead you to some exciting new endeavours: family vacations, volunteer opportunities, talents you want to develop into skills, skills you want to use to create a new company.

Ready to go deeper on these and other important questions? Make an appointment with Cornerstone Wealth today! We’re confident that our planning process will give you a new, more positive, and more empowering perspective on your retirement.