The concept of legacy planning – a multi-generational planning approach focused on smooth wealth transitions, reduced family discord, and effective preservation of family values and leadership – is critical to preserving generational wealth.
Have you expressed confidence that your children are “solid” and will have no issues handling their inheritance down the road? I encourage you to rethink that assumption if for no reason other than the significant influencers in addition to your children – their spouse or partner, and your grandchildren, for example.
As a firm, none of our long-term clients obtained their wealth through inheritance. (However, some newer clients have inherited large sums from their parents, who are also our clients.) All of our long-term clients created their wealth through hard work, smarts, perseverance, good fortune or some combination.
Why have none of our long-term clients inherited their wealth? After all, folks with wealth, regardless of the origin, often seek assistance with managing it.
At PartnersInWealth, we work best with goal-oriented people with purpose in their lives. In other words, people who have a strong motivation to get out of bed in the morning. Over the years, we have interviewed many people who inherited their wealth to see if their needs and our services are a good fit. Through these interactions, we have observed that many people with inherited wealth are like a rudderless ship. They don’t seem to strive towards anything specific and, consequently, often struggle to find purpose in their lives.
Learn From John F. Kennedy, Jr.
When asked why he started the magazine “George,” John F. Kennedy, Jr., who died in a 1999 plane crash, explained that the curse of being born into wealth is you have almost unlimited options, and you’ve got to make a choice to live a fulfilling life. For him, the choice that gave him purpose was the magazine.
Will your children continue to have a fulfilling purpose when they inherit money? Or will the seduction of wealth slowly erode their purpose and cause unhappiness, leading to relationship problems, negatively affecting their health, and creating many other unwanted issues?
Don't Leave Your Legacy to Chance
The truth is none of us know for sure what long-term effects an inheritance will have on our children. But you don’t have to leave the outcome to chance. You can learn legacy planning skills and slowly integrate them into your relationship with your children. This will increase the likelihood that, when they do receive their inheritance and their choices in life increase significantly, they will be well-equipped to make decisions that would make you proud.