Estate planning considerations for wealthy individuals

If your individual or household's total of assets minus liabilities is $5 million or more, you're considered high-net-worth.

Estate planning for wealthy individuals offers distinct opportunities to provide for future generations of your family and ensure your wishes are carried out after you're gone. You've worked hard to build something meaningful—whether it's a business, a home or the financial security your family counts on. Estate planning helps make sure your legacy doesn't get tangled in red tape, eaten up by taxes or left to chance.

Read on for tax-saving and asset protection strategies that can help protect your legacy and provide for those you love when it's most needed.

When you have a high net worth, estate planning typically involves careful consideration about what you want your money and assets to do for others after you die. You have significant wealth to protect and greater opportunities for stewardship. You'll want to think about how to disburse the assets you have, how you can be efficient with taxes, and how you want to give to others.

• Handling complex assets. Many people achieve wealth by owning businesses, rental properties or a variety of investments. Owning these assets means you're subject to a range of tax laws and liability exposures that often require expert support to fully understand. Selling or passing down your assets also requires careful forethought to maximize their value.
• Minimizing federal and state inheritance taxes. In 2025, you can pass down as much as $13.99 million without owing federal estate tax. Following the One Big Beautiful Bill Act, starting in 2026 you can transfer up to $15 million tax-free during your lifetime or at death (double that for married couples). This exemption will increase with inflation each year and is now a permanent part of the tax code. Keep in mind that you may have state-based estate or inheritance taxes, and their exclusion amounts may be different than the federal threshold.
• Leaving a financial legacy. Many people who have accumulated wealth want it to benefit their relatives and other loved ones or causes that are important to them. This means knowing the best ways to transfer generational wealth and maximize charitable giving. Trusts and other estate planning tools can help protect the assets you want others to benefit from.

The following strategies can help you effectively pass on different assets while minimizing taxes and creating long-term wealth for your family and your community.

High-net-worth individuals typically need more than a will and powers of attorney. Specific legal documents can help you manage your assets in detailed ways and make it easier to transfer your wealth while minimizing potential legal fees and taxes. Here's an overview of the most common estate planning strategies that high-net-worth families use to distribute their wealth.

A trust is a legal arrangement where one party (the grantor) transfers assets to another party (the trustee) to provide for specified beneficiaries. Trusts can help you preserve your legacy and transfer assets while also offering privacy by avoiding probate.

Many types of trusts can help you do this, such as:

• Revocable living trust. Revocable living trusts are flexible and changeable. Grantors retain control of the trust assets during their lifetime and can modify or dissolve the trust if they want.
• Irrevocable trust. Irrevocable trusts mean the grantor permanently gives up ownership and control of the assets, but they come with some benefits. Assets listed in the trust are removed from the grantor's taxable estate, offering tax savings and creditor protection for the beneficiary. 
  
  • Grantor-retained annuity trust (GRAT). GRATs are another type of irrevocable trust that allows you to transfer appreciating assets to beneficiaries at a potentially reduced gift tax cost. The grantor receives annuity payments from the trust assets for a specified duration. Any growth of the trust's assets passes to the trust's remainder beneficiaries, free of estate tax, when the term ends.
  • Dynasty trust. This particular type of irrevocable trust can help preserve wealth across multiple generations by reducing estate and generation-skipping taxes. Once set up, they can't be changed. But with the right structure and careful management, they can keep going for generations.

Because they provide privacy, protection and legacy, trusts are a popular vehicle for high-net-worth estate planning.

Strategic lifetime gifting lets you provide for the people you care about while you're alive to enjoy it. Lifetime gifts also can reduce future estate taxes. Here are several popular opportunities:

• Annual exclusion gifts. Annual exclusion gifts do not count against your lifetime estate tax exclusion. In 2025, you can give up to $19,000 per recipient. Married couples can give up to $38,000 per recipient. Limits are adjusted annually for inflation.
• 529 plan contributions. The tax code allows you to front-load five years' worth of annual exclusion gifts when you put the money in a 529 college savings plan. You won't be able to make additional annual exclusion gifts to the beneficiary until those five years are up. However, you will enjoy a longer time horizon for your contributions to compound tax-free.
• Life insurance. Using life insurance to leave a legacy is a strategy where you pay premiums and earn cash value to provide your loved ones with a death benefit. When you own the policy, the death benefit becomes part of your taxable estate. But you may be able to combine this gifting strategy with an irrevocable life insurance trust (ILIT). It can keep the proceeds out of your taxable estate because the trust owns the policy.

In addition to making gifts to loved ones, you also can spend less on taxes and choose to donate your wealth to charitable organization.

Charitable giving can be a financially, emotionally and spiritually significant part of estate planning for wealthy individuals, and you can have a bigger impact when you give strategically. Here are two options.

• Charitable remainder trust (CRT). CRTs allow you to receive an income stream during your lifetime from assets you ultimately will give to charity. The assets you place in the trust will be removed from your taxable estate and also may be tax-deductible in the year you transfer them.
• Donor-advised fund (DAF). DAFs can offer flexibility in charitable contributions and tax planning. If you want to remove assets from your estate and get a charitable deduction on your income taxes but you're not sure which nonprofit you want to benefit, a DAF gives you time to decide.

To amplify your estate tax savings and your gift, consider using appreciated assets to fund a CRT or contribute to a DAF.

Designing a customized estate plan—particularly when you have a lot of wealth—requires specialized knowledge. It's important to create a team of experts you trust to suggest strategies and help you implement them. People who expect to have a high-net-worth estate should work with at least these professionals:

• Estate planning attorney. Your attorney recommends trust structures and creates trust documents tailored to your situation.
• Financial advisor. This key member of your team helps you look at your money holistically and partners with you to help you make financial decisions that reflect your values.
• Tax professional. A tax professional can help you prepare annual income tax returns, gift tax returns and estate tax returns. They also point out opportunities to reduce income and estate taxes and provide the information your financial advisor needs to help you with efficient tax planning.
• Trustee. This person follows the provisions of your trust documents to manage trust assets and distributions in the best interest of your trust beneficiaries. It can be a friend or relative with the right skill set, a financial advisor or attorney who offers this service, or an institutional trustee, such as Thrivent Trust Company.

It's critical in estate planning to let people who are directly involved know about your intentions. This includes your estate administrator (also called an executor), trustees and beneficiaries. Make sure these key people, along with your estate attorney, know where to find your most recently signed original documents.

By sharing the wealth transfer decisions you've made ahead of time, you have the chance to answer any questions they might have and talk about what you have in mind. However, it also can be a challenging conversation topic—or you may have an interest in keeping your estate information private until it needs to be known. Another option is to write a letter to go with your will. While communications other than the estate planning documents themselves aren't necessarily legally binding, you can at least express how you hope your wealth will be used.

Estate planning for wealthy individuals is a complex process that requires careful consideration. Connect with a Thrivent financial advisor to take your next steps toward building a team that's focused on the legacy you want to create. With support you can trust, you can ensure that your wealth serves a greater purpose that aligns with your values and leaves a lasting impact.