HONOLULU (KHON2) — Generational wealth is something many of us aspire to financially, but how do you navigate it? Reyn Akamine a VP & branch banking market manager for Central Pacific Bank joined Take2 Wednesday morning with a roadmap to help.
“Generational wealth can provide financial security for future generations, reduce stress, and offer opportunities for education, homeownership, and business ventures. It can also help maintain family legacies and traditions,” Akamine said.
No one likes to talk about death, but Akamine says it’s an important subject to talk about in advance.
“It is sad, but death is inevitable. It is always best to have a plan. So many times, we have examples of a single parent passing away with no instructions or beneficiaries. Without declaring your last wishes for who you want to get the money, there is no way for the courts or banks to know. It is so important to go to your bank and let them know what your next steps will be, including listing your beneficiaries.”
Starting a conversation about finances is an important start.
“In local style, it is difficult to talk for fear of coming across as being nosy, but it is better to talk it out with family before, rather than the courts, after the fact,” Akamine said. “Let those you trust or your beneficiaries know what accounts you have and share a copy of your trust. Another option is sharing a copy of your trust with your banker or attorney, so someone has an official copy of your last wishes and instructions.”
Akamine says there are differences between a last living will and a trust.
“Both are better than nothing,” Akamine said. “However, wills can still go through the probate process and typically only controls the distribution of your personal property. A trust can generally avoid the probate process, which can help save time and money. Trusts can hold a variety of assets, including real estate, personal property, and financial accounts. If you have a complex estate, such as minor children, significant assets, or specific wishes for your property, a trust can provide more flexibility and control.”
Common trusts are revocable, irrevocable, and charitable.
“The revocable trusts allow you to make changes depending on current circumstances,” Akamine said. “If something happens while you’re still living, and you want to make a change, you can. An irrevocable trust is more definitive. Once it is laid out, the decisions will need to be carried out based on the trust. The charitable trusts are when they want to give all their assets to charity. That can also be in a revocable trust. This is why all of your financial accounts must be listed within your trust to have your wishes protected. Make sure to go to the bank and add your trust to all your financial accounts.”