As spring brings a fresh start, it’s also the perfect time to ensure your family’s financial future is on the right track. Planning ahead helps protect your wealth, maximize tax advantages, and create financial stability for future generations. Here are some key considerations for spring financial planning:
Take Advantage of the Annual Gift Tax Exclusion
For 2025, the IRS allows individuals to gift up to $19,000 per recipient tax-free, and married couples can give up to $38,000 per couple without utilizing any of their lifetime gifting or estate exemption. Gifting is an effective way to pass on wealth while reducing estate tax liability.
Consider Establishing or Updating a Trust
Trusts offer a way to manage and distribute assets efficiently while maintaining control over how they are used. They can help bypass probate, protect assets for minor children or beneficiaries with special needs, and reduce estate tax burdens. Reviewing existing trusts or establishing one tailored to your family’s needs can provide long-term financial security.
Ensure Your Life Insurance Aligns with Your Family’s Needs
Life insurance is often overlooked in financial planning, but it plays a crucial role in protecting your family’s future. If you haven’t reviewed your policy recently, consider whether your coverage is sufficient to replace income, cover debts, or provide for dependents. If your family or financial situation has changed—such as a marriage, the birth of a child, or retirement—adjusting your policy may be necessary to maintain adequate protection.
Review and Update Beneficiary Designations
One of the simplest yet most important financial planning steps is ensuring your beneficiary designations are up to date. Accounts such as 401(k)s, IRAs, life insurance policies, and bank accounts with payable-on-death designations should be reviewed periodically to reflect any life changes. This ensures that your assets go to the intended recipients without complications.
Plan for Education Expenses with 529 Plans
If you’re saving for a child or grandchild’s education, 529 plans offer tax-advantaged growth and withdrawals for qualified educational expenses. Many states also offer tax deductions or credits for contributions. Spring is a great time to review your contributions and adjust based on your savings goals.
Schedule a Financial Check-Up
Just like an annual health check-up, a financial review can help you stay on track with your long-term goals. Work with a trusted advisor to assess your current financial situation, tax-saving strategies, investment portfolio, and estate plans. Proactively addressing these areas can prevent financial stress down the road and ensure your plans align with your family’s evolving needs.
A Thoughtful Approach to Family Financial Planning
Financial planning isn’t just about numbers—it’s about securing the well-being of the people who matter most. By taking intentional steps today, you can protect your family’s financial future, minimize tax burdens, and create lasting security for generations to come. Spring is a season of renewal—use it as a reminder to take action on your financial goals.
Please note: Information in this article offers only a high-level overview of the factors to consider before taking any action or decision. There may be other factors that are not captured in this article but may still be crucial prior to making a decision. Examples are purely hypothetical and for illustrative purposes only; they should not be taken as an indication that clients will achieve identical results. Clients or prospective clients should not base their decisions solely on this article. It is recommended that clients or prospective clients further research this topic or consult with professionals before making any decisions. DHJJ is neither a law firm, nor a certified public accounting firm, and no portion of the commentary content should be construed as legal or accounting advice. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. You should not assume that any portion of this article serves as the receipt for, or as a substitute for, personalized investment advice from DHJJ Financial Advisors, LTD.
