I’m a Certified Financial Planner: 3 Wealth-Transfer Tips I Tell My High-Income Clients

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From the Instagram influencers flaunting yet another exotic vacation to the Joneses down the block (you know, the ones you’re supposed to keep up with) building a giant addition to their already palatial home, many people seem to think of wealth as an achievement in and of itself. However, truly smart, high-income people know that wealth isn’t for flaunting — it’s for growing and sharing across generations.

Certified financial planners work with these high-income earners to help them turn an initial seed of wealth into a thriving garden that will nourish their heirs and even the descendants they’ll never get to meet. As these planners build relationships with their high-income clients, they refine the smoothest, most efficient wealth-transfer strategies. 

To better understand these strategies, GOBankingRates spoke with Scott Sturgeon, founder and senior wealth advisor at Oread Wealth Partners, about how high-income individuals can ensure their wealth is passed on according to their wishes.

1. Make Strategic Gifts

If you already love giving gifts, you’re in luck. Sturgeon says one of the easiest ways to transfer wealth involves giving cash or other assets to family members every year. However, you do need to be careful that the amounts of the gifts remain under the annual gift tax exclusion, which is $19,000 per recipient in 2025. 

“The annual exclusion can be a great method of transferring wealth tax-free because the limit actually applies from one person to another person,” he said.  

In essence, if a wealthy married couple wanted to make a significant gift to their daughter and her partner, they could each give $19,000 to both the daughter and the partner, totaling $76,000 altogether. If they have multiple children, they can continue to gift up to the exclusion limit for each recipient.

2. Fund a College Savings Account 

Education is a worthy investment — one that deepens the mind while expanding job opportunities and earning potential. It’s also a smart, and fairly common, wealth-transfer tool, particularly through funding a 529 college savings plan. 

“Most states provide a state-level tax deduction up to a certain amount for funds transferred to a 529,” Sturgeon said. “The assets can grow tax-free in the account, and as long as they’re withdrawn to cover certain educational expenses, it’s tax-free as well.”

Since college costs are a major expense for most families, using a tax-advantaged strategy to ease the financial burden can have a lasting impact — especially in terms of reducing the amount of student loans a young person may have to take out, allowing them to graduate with less debt and greater financial freedom.

Sturgeon adds that beyond reducing financial strain, access to higher education can help future generations build and share their own wealth. 

“There’s a certain amount of knowledge and social capital that also comes with attending college, which often goes understated and certainly contributes to wealth building for next-generation family members,” he said. 

3. Create a Family Limited Partnership 

While Sturgeon says that his previous insights are relatively simple and easy to implement for most high-income families looking to save on taxes and transfer assets, there’s another, more complex approach that could be beneficial for families with significantly higher net worth. 

Very high-income individuals may consider using a family limited partnership, or FLP, to tax-efficiently transfer assets such as businesses, large real estate holdings, or other high-value assets that could put their net worth above the current estate tax exemption — roughly $14 million per individual or $28 million per married couple.

“This can get complicated quickly, but you’re basically trying to transfer ownership interests in the partnership to the next generation while keeping those transfers under the annual gift exclusion,” Sturgeon said. “[There are] lots of moving parts that will likely require involvement of an attorney to set up the required legal entities and a third party to assign a valuation to the assets.”

However, if structured correctly, an FLP can be a powerful tool for transferring portions of assets to the next generation while potentially reducing — or even avoiding — estate tax liabilities.

Looking to build a legacy? Check out our Life to Legacy guide for expert advice and smart moves you can make today.

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