A well-designed estate plan can form the foundation for a family legacy, providing a values road map for future generations to follow.
Cathy Nakamura, CTFA, senior family office relationship manager at Wealth & Investment Management, Wells Fargo Bank, N.A., has experience helping clients navigate the process of planning a lasting, values-driven legacy.
"A good starting point is to determine your values and how those values are reflected in your estate plan. You can create the structure to communicate those values to the next generation and beyond."
Nakamura suggests taking these five steps:
Though it’s not a legally binding document, a family mission statement explains the values you’d like to pass on to the next generation. Working through the details together, as a family, helps the next generation understand your wishes.
"I’ve found that oftentimes, it’s a sudden life event that makes the next generation aware of the family wealth," Nakamura says. "The next generation may not know how to handle the wealth or honor their parents’ wishes."
She encourages parents to outline their estate planning goals and objectives and create their family mission statement before sharing with the family. The Wells Fargo wealth team can work with the clients and their estate planning attorney.
"It starts with the wealth creator identifying their values and what they want their legacy to be," Nakamura says. "Wells Fargo assists to engage the next generation and facilitate meaningful discussions to create the family mission statement together. Open communication helps beneficiaries understand the values of the estate plan and alleviates potential family conflict."
Your estate plan can encourage future generations to behave in a manner consistent with your family values. "For example, trust language could support choosing a less lucrative profession but one that aligns with the family’s values," she says. "Similarly, they can set conditions that reward other behaviors, such as earning a degree or building a productive career."
When beneficiaries understand the rationale behind your estate plan, it can foster greater family harmony.
Investing in younger generations by funding their education can be an important part of your values-based estate planning strategy — and may have tax advantages, too.
"Paying into a 529 plan or paying tuition bills directly to the institution can help reduce estate taxes," Nakamura says. "In addition, you can make up to five years’ worth of annual exclusion gifts to the 529 plan in one year.1 So, based on the 2026 annual exclusion of $19,000 (or $38,000 per couple), you can contribute up to $95,000 (or $190,000 per couple) without using any of your lifetime exemption. While the money in 529 plans may only be used for educational expenses, those funds can also be transferred to another beneficiary, such as a grandchild or great-grandchild, if the original intended beneficiary does not use the funds."
Please consider the investment objectives, risks, charges and expenses carefully before investing in a 529 savings plan. The official statement, which contains this and other information, can be obtained by calling your financial advisor. Read it carefully before you invest.
Another option is to create a trust with provisions providing financial support to named beneficiaries for their health or education, for starting a business, or for other endeavors important to the wealth creator. Your Wells Fargo fiduciary strategist and/or wealth strategist can help you explore the potential advantages of leveraging trusts for education or health savings.
Starting a foundation or donor-advised fund can offer tax benefits and also provide direction and purpose for family wealth.
"Charitable giving is a great way for families to work together around the idea of giving back in a manner that aligns with the family’s values," Nakamura says.
If you’re interested in forming a foundation or donor-advised fund, Wealth & Investment Management offers resources to help navigate through those processes. Talk to your fiduciary strategist to get more information.
As you consult with your tax and legal advisors to determine the appropriate wealth transfer strategy for a values-based legacy, consider including your fiduciary strategist or wealth strategist to help you create a road map.
"We can put structure and form around your estate priorities," says Nakamura. "Also, don’t overlook the opportunity to talk to your family about what matters to you — and what you hope will matter to them when you’re gone."
Don’t have an advisor?
1 The donor must elect that the gift be treated as having occurred over a five-year period in order for it to qualify for the federal gift-tax exclusion. If additional gifts are made to the same beneficiary during this five-year period, a federal gift tax may apply. If the donor dies within this five-year period, a pro rata share will be included in the donor’s estate for federal estate tax purposes. State gift and estate tax laws may vary. Consult your tax advisor.
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