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2021 WEALTH PLANNING OUTLOOK

RENEWED PURPOSE

The global pandemic has upended life as we know it, bringing into focus one, often taken-for-granted facet of existence on which all others hinge: our health. For many, this has brought resolve to pursue what matters most as we enter a new phase of recovery and transformation.

Take Advantage of Tax Planning Opportunities

Political and economic dynamics could suggest a higher future tax environment. The trifecta of historically high exclusion amounts, record low interest rates and future tax uncertainty make this a pivotal time to revisit your wealth plan.


The Higher Estate Tax Exemption “Bonus Amount” Is Use or Lose


1Adjusts based on the consumer price index (CPI-U), a measure of inflation designed by the Bureau of Labor Statistics to measure the average change over time in the prices paid by urban consumers for a market “basket” of consumer goods and services.
2Adjusts based on the chained consumer price index (C-CPI-U), a measure of inflation designed by the Bureau of Labor Statistics that accounts for any substitution that consumers make across item categories in response to changes in relative prices.
Source: Northern Trust

Embrace a New Technological Frontier, and Strengthen Your Digital Defense

The competitive advantages offered by emergent technology cannot be underestimated, and those with an open mind — and sufficiently strong cyber defenses — will be best positioned to adapt and thrive.


Reimagine connectivity

 

Fulfill Your Most Important Life and Legacy Goals

The pandemic has many feeling less tethered to their current domicile while even more committed to protecting life goals and loved ones. A goals-based lens offers clarity during a time of uncertainty.


Many high net worth individuals are planning to move to reduce their tax impact


Source: Survey of Northern Trust Wealth Management high net worth clients (>$5M in investable assets) conducted August 2020 to September 2020.

Maximize Your Impact

A renewed sense of purpose to address societal needs will see innovative approaches from the philanthropic community and more opportunities for sustainable investing.


A growing preference for socially responsible investments


Source: Morningstar Direct Data as of 9/30/2020. Includes funds from Morningstar Direct's Sustainable Landscape U.S. Funds Q2 2020. Does not include funds that have been liquidated; does not include funds of funds.

Prepare for the Great Business Reset

Faced with profound challenges and uncertainties stemming from the events of 2020, business owners, families and shareholders are creatively refocusing, reevaluating and redesigning for 2021 and beyond.


Small business confidence index


Source: Northern Trust Global Asset Allocation, Bloomberg. Small Business Confidence: Monthly data through 10/31/2020. NFIB Small Business Optimism Index is a composite of ten seasonally adjusted components calculated based on the answers of around 620 NFIB members. This questions include: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect economy to improve, expect real sales higher, current inventory, current job openings, expected credit conditions, now a good time to expand, and earnings trend.

2021 WEALTH PLANNING OUTLOOK

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