INSIGHT

Estate vs. financial planning 

Tony Gales • May 1, 2025

Services: Estates, Gifts & Trusts

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When it comes to securing your financial future, both financial planning and estate planning can be essential. While these terms are often used interchangeably, they serve distinct yet complementary purposes in your overall wealth management strategy. 

At BPM, we understand that navigating these two areas can seem overwhelming. That’s why we’re breaking down the key differences between estate and financial planning, while showing you how they work together to protect your assets now and for generations to come. 

Understanding financial planning: Building wealth during your lifetime 

Financial planning is essentially a strategic roadmap for managing your money throughout your life. It’s about understanding where you are today financially and creating a clear path to reach your short and long-term goals. 

A comprehensive financial plan typically includes: 

• Budgeting strategies to manage everyday expenses and save effectively 
• Investment planning tailored to your risk tolerance and time horizon 
• Tax planning techniques to minimize your tax burden 
• Insurance planning to protect against unexpected financial setbacks 
• Retirement planning that allows you to maintain your lifestyle after you stop working 

For example, if you’re dreaming of purchasing a home in the next few years, a well-structured financial plan can help you get there. Creating a comprehensive financial plan helps to assess your current situation, develop a savings strategy for your down payment, and optimize your credit profile to secure favorable mortgage terms. 

Financial planning is about making your money work for you during your lifetime, helping you build wealth while maintaining financial security along the way. 

Understanding estate planning: Preserving wealth beyond your lifetime 

While financial planning focuses on growing and managing your wealth during your life, estate planning addresses what happens to your assets after you’re gone. It’s about ensuring your hard-earned wealth benefits the people and causes you care about most. 

Estate planning isn’t just for the ultra-wealthy. Everyone has an “estate” – whether it’s a family home, retirement accounts, investments, or personal possessions with sentimental value. 

A well-crafted estate plan typically includes: 

• A will that outlines how you want your assets distributed 
• Powers of attorney that designate someone to make financial and medical decisions if you’re unable to 
• Trusts that can help avoid probate and potentially reduce estate taxes 
• Healthcare directives that specify your wishes for end-of-life care 
• Guardianship designations for minor children 

Beyond simply distributing assets, estate planning helps minimize taxes, protect assets from potential creditors, and create a smooth transition of wealth—especially important if you own a business or have complex family dynamics. 

Why you can’t have one without the other 

The debate between estate planning vs. financial planning misses an important point: these strategies work best when implemented together as part of a holistic approach to wealth management. 

Think of financial planning as building and growing your wealth, while estate planning helps ensure that wealth is preserved and distributed according to your wishes. They’re two sides of the same coin. 

Here’s how they complement each other: 

1. Tax efficiency: Financial planning helps minimize your tax burden during your lifetime, while estate planning works to reduce potential estate and inheritance taxes after you’re gone.  

2. Asset protection: Financial planning helps you build assets, while estate planning helps shield those assets from potential creditors or legal claims. 

3. Business succession: If you own a business, financial planning helps you grow and manage the business, while estate planning helps ensure a smooth transition of ownership. 

4. Family security: Financial planning helps provide for your family while you’re alive, and estate planning is designed to continue that security after you’re no longer here. 

When do you need to start planning? 

Many people put off financial and estate planning, believing it’s something to worry about later in life. However, certain life events should trigger you to revisit both your financial and estate plans: 

• Receiving a significant inheritance or selling a business 
• Getting a substantial promotion or increase in income 
• Approaching retirement 
• Marriage, divorce, or having children 
• Purchasing major assets like a home 
• Changes in tax laws that may affect your wealth 

The truth is, it’s never too early to start planning. Young professionals can benefit from basic financial and estate planning just as much as those approaching retirement. The sooner you start, the more options you’ll have to grow and protect your wealth. 

How BPM can help with your integrated planning needs 

At BPM, we believe in taking a holistic approach to your financial life. Our team of experienced advisors can help you develop both financial and estate plans that work together seamlessly. 

We understand that every client’s situation is unique. Whether you’re just starting your career, growing your family, approaching retirement, or thinking about your legacy, we can create customized strategies that align with your specific goals and circumstances. 

Our integrated approach is designed to manage your wealth effectively during your lifetime while creating a thoughtful plan for how it will be preserved and distributed according to your wishes after you’re gone. 

Ready to start securing your financial future? 

Don’t wait until a major life event forces you to think about your financial and estate plans. Being proactive now can save you and your loved ones significant stress and potential financial loss in the future. 

Contact BPM today to schedule a consultation with one of our advisors. We’ll help you create a comprehensive strategy that addresses both your financial planning and estate planning needs. 

Let us help you build, protect, and pass on your wealth in the most effective way possible. Your future self (and your loved ones) will thank you. 

Securities offered through Valmark Securities, Inc. Member FINRA, SIPC | Investment Advisory services offered through BPM Wealth Advisors, LLC and/or Valmark Advisers, Inc. a SEC Registered Investment Advisor. BPM LLP and BPM Wealth Advisors, LLC are entities separate from Valmark Securities, Inc. and Valmark Advisers, Inc.