The rich are adjusting their estate planning ahead of the 2024 election – should you, too?

As the U.S. slowly heads toward a crucial, if turbulent, election, Americans of all socioeconomic backgrounds are evaluating which presidential candidate will best have their financial interests in mind. However, there is a little more movement among the wealthy when it comes to estate planning as they anticipate potential changes in tax and financial policy.

Learn more: I'm an economist – here's my prediction for Social Security if Trump wins the 2024 election

Check out: 9 Things You Need to Do to Grow Your Wealth in 2024

With Vice President Kamala Harris and former President Donald Trump at the center of the election, concerns are growing that the outcome could lead to drastic changes to estate taxes, capital gains taxes and wealth transfer rules, particularly with regard to estate tax minimization.

Now the wealthy are determined to get their estate planning attorneys on the phone to put plans in place that would protect their wealth from higher estate or inheritance taxes long before the election results.

Check out what else the rich do with their money and what you should consider too.

Harris vs. Trump: Estate Planning Considerations

The contents of your estate planning documents are a legitimate concern when it comes to assets such as real estate and retirement accounts that may be affected if the 2017 tax cuts expire after 2025 as scheduled. The policies of the winner of the presidential election play a role when it comes to voter indecision, especially among members of the baby boomer generation. According to the Urban-Brookings Tax Policy Center:

Read more: I'm an economist – here's my prediction for Social Security if Kamala Harris wins the election

Estate planning should not be political, but it is

The inheritance tax, often called the “death tax,” has long been a controversial issue in American politics. For wealthy individuals, the inheritance tax can significantly reduce the amount of wealth passed on to future generations.

Harris has proposed tax reforms that could potentially lower the estate tax exemption and raise tax rates on wealth transfers. Trump, on the other hand, advocates keeping the exemption high and possibly even eliminating the estate tax altogether. This stark political divide has caused wealthy individuals to rethink their plans.

General adjustments you can make to your estate planning

The rich know their loopholes, so if you need your own durable power of attorney or tax advisor, you can take a leaf out of their book. This will not only help you protect your loved ones with life insurance or a power of attorney, but also provide them with a comprehensive plan for when you die. Here are a few tips you can follow in your own estate planning.

• Speed ​​up gift giving: Wealthy families want to transfer their wealth to their heirs now, even though current gift tax exemptions are still high. By using strategies such as irrevocable trusts, families can secure favorable terms before changes take effect.

• Revaluation of trusts: Many restructure trusts to protect assets from potential future tax burdens or probate proceedings. Charitable Remainder Trusts and Grantor-Retained Annuity Trusts are common tools for minimizing taxes while efficiently passing on assets.

• Capital gains planning: Faced with the possibility of an increase in capital gains tax rates, particularly on inherited wealth, the super-rich are proactively selling high-appreciation assets, adjusting legal documents or diversifying their portfolios to mitigate potential tax burdens.

• Work with a financial advisor or tax advisor: Estate planning is complex and highly individualized. Working with an estate planning attorney or financial advisor can help you navigate potential changes and ensure your plan aligns with your long-term goals while minimizing the amount of human error.

Last Take To GO

The bottom line is that the outcome of the Harris-Trump election will affect many aspects of your life and death planning as the electorate draws closer. Estate planning is top of mind for America's wealthiest families, but it's something everyone should be thinking about. While who will be president is still uncertain, the potential for significant changes in tax policy remains very real. Proactive estate planning now, even if your assets don't meet the current estate tax exemption limit, can protect your loved ones from future financial burdens.

Editor's Note on Election Coverage: GOBankingRates is nonpartisan and strives to objectively cover all aspects of the economy and present balanced reporting on politically focused financial topics. For more coverage on this topic, visit GOBankingRates.com.

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