The Basics

After I die, will my children receive social security benefits?

It depends on how long you've worked in a job where you've paid social security taxes and how old your children are at the time of your passing.

First, how long you’ve worked: you must have earned the required number of social security credits by working in a job where you pay social security taxes on your earnings. Typically, the required number of credits is 40, depending on your age at the time of your death. But a special rule applies to young workers that may allow your children to be eligible for benefits if you earned at least six Social Security credits in the three years just before your death. Because you can earn only four credits per year, you must have worked at least a year and a half to earn these six credits.

To be eligible for social security benefits when you die, your children must be age 18 or under (19 if still in high school), and unmarried. Special rules apply to unmarried children who are disabled. Your child may be eligible to receive up to 75% of the benefit that the Social Security Administration calculates you would have received if you had reached full retirement age at the time of your death. Various factors will affect the amount of your child's benefit, including whether other family members are also receiving benefits on your earnings record.

To find out more about what survivors benefits your child might receive if you die, based on your earnings record, check your social security statement. To access your statement, sign up for a my SocialSecurity account at the Social Security Administration's website, ssa.gov.

How do I prepare for the transition of wealth?

Talk to your financial advisor. They’ll discuss your wishes and, based upon a number of factors, can guide you through the many options available to you.

When should I start planning for the transition of wealth?

There’s no time like the present. In fact, the sooner you get a plan in place, the more peace of mind you’ll have. In addition, you’ll be prepared should the unexpected occur, and your wishes will have already been made known and legally set in place. Without a formal plan, your wealth will be susceptible to court decisions and unprotected from taxes. While your heirs will be left without the benefit of the generosity you’d intended for them. The safer course of action would be to start planning with your financial advisor today.

When should I start planning for the succession of my business?

Now. Your exit strategy and the subsequent transfer of power can be a complicated and emotional issue. The sooner you make a formal plan, the sooner you can start to groom the next generation of business leaders or keep things on track for a successful sale, if that’s what you prefer.

The key is deciding now what you want the future of your company to look like. Do you want control of the company to go to certain people, or do you want to provide for those people without leaving them the responsibilities that go with running a business? Both courses of action require prudent planning on your part. In fact, the process could take years. The right business succession plan will help you make important decisions about ownership, maximizing your company's value and identifying beneficial tax strategies.

What are my options for passing on wealth if I have no children?

In general, those without children often plan to make sure their surviving spouse is taken care of and that their wishes for end-of-life care are respected. In addition, making sure your pet(s) have a new home, rather than a shelter, can be a priority as well.

Beyond that, a worthy charity, church or alma mater can all benefit from your generosity. An advisor can help with a plan to ensure your wishes are carried out.