How to get what you CAN'T buy
In my last 5 messages (“chapters” in report), I’ve talked about how to ensure your business serves your clients and your family after you’re gone, how to empower your family for generations by NOW passing on your inheritance to them, and how to make the biggest impact possible working most effectively with charities.
The summary of all these strategies: maximize your fulfillment, your impact, and your legacy.
So, how CAN you get what you can’t buy? Am I talking about love? Eternal youth? Living forever? It’s actually a little of all 3, and I’ll reveal that to you in a moment…
The Beatles’ song famous line, “You can’t buy me love,” is true. It’s ALSO true that you can’t buy lasting fame or respect, or the holy grail fountain of youth to live forever.
However, you can be remembered and still making a significant impact many generations after you’re gone with the right strategies… even if you’re not a billionaire like Andrew Carnegie or Bill Gates, Warren Buffet, or other Giving Pledge members today.
Andrew Carnegie is a great example of leaving a lasting impact. He gave all his money to charity by the time he died, and he funded Carnegie Hall in New York, Carnegie Mellon University in Pittsburgh, and hundreds of public libraries across the U.S.A. Even though most Americans today don’t know much about him besides the fact that he was in the steel industry, his impact is felt every time someone expands their mind with new knowledge at one of the libraries he built.
Andrew Carnegie decided to give all his money to charity while still alive and die broke. Others give all their wealth to their family when they die, and their heirs squander it quickly. Other successful people like you set up foundations that support charities for multiple generations after they’re gone (like the Ford Foundation that Henry Ford started). How do you decide which strategy is best for YOUR family?
From all my research of successful families, I’ve discovered that the best strategy is to balance leaving an inheritance for your family and giving money to charity so you can make the biggest total impact on the world with your life. The satisfaction from making a big, lasting difference can't be bought... yet it can be gained with the right strategies!
Let’s review the biggest challenges standing in your way of leaving a LONG-lasting legacy so you can address them most powerfully:
******************************
Legacy Challenge 1: Giving your Heirs TOO Much Wealth
******************************
You’ve likely heard the horror stories of wealthy heiresses Paris Hilton and Kim Kardashian embarrassing their families. In fact, Paris Hilton embarrassed her grandfather SO much that he took her out of the family will!
What went wrong? And how can you avoid ruining your kids so they don’t up like Paris Hilton or Kim Kardashian?
Many wealthy parents wring their hands struggling with how much money to leave their kids so that they don’t struggle in life, yet they aren’t made lazy and ruined by the wealth they receive. In fact, billionaire Giving Pledge members discuss this challenge very often with each other. How much money is enough? And how much money is too much to leave them? These are good questions to ask, but there are even better ones you and your spouse should be asking.
One way to address this risk is to put performance clauses in trusts you set up for your heirs so they have to behave certain ways to receive their funds, which is what 99% of estate planners you speak with would tell you to do to keep your kids from embarrassing your family. These trusts are only minimally successful in “keeping your kids in line,” and they usually strain your relationship with each other because they don’t address the root causes of embarrassing behavior.
The challenge is more than just the amount of money your heirs are given. The ROOT problem is lack of training in and modeling of the best etiquette, morals, and values- basically, the condition of your heirs’ hearts. I’ll show you the BEST way to address this root problem for your heirs in a moment…
******************************
Legacy Challenge 2: Creating Bitterness in your Heirs
******************************
If you leave your heirs lots of money because you love them, why do they often end up bitter towards you? This is a perplexing challenge MOST wealthy parents like you face, and it’s very frustrating.
For most wealthy heirs, the anger and bitterness step from not being empowering enough to manage what you leave them.
In many families, talking about money is taboo, so parents create estate plans for leaving money to their heirs and charities without EVER discussing it with their family. This usually leads to many negative reactions in family members when parents die, as the first time they’re hearing about their parents’ wishes is in an ultra-emotional state of grief. Avoid this at all costs!! If you don’t, you’re running a 90%+ risk of leading your family towards Financial Success Failure as I wrote about a few chapters back.
The GOOD NEWS is there’s a simple, yet powerful solution to this challenge while I’ll reveal to you shortly.
******************************
Legacy Challenge 3: Unclear long-term family charity strategies
******************************
As I mentioned above, Andrew Carnegie gave away virtually all his wealth to charity during his lifetime. Other families like the Fords set up foundations that give away a smaller % of their funds (a.k.a. their “endowment”) yearly so that they live on for multiple generations.
At first glance, one of the 2 models may seem like the best fit for you, and they each have specific challenges that must be addresses. Here are just a few examples:
If you set up a Carnegie-style ‘spend down’ foundation that still has a significant amount of wealth in it when you die, how do you ensure your heirs finish what you started and put the funds towards the causes you want them to go to? How do you avoid your heirs suing your estate and fighting over the funds?
If you set up a perpetual foundation like the Ford Foundation, how do you ensure the funding goes to charities that you’d approve of decades after you’re gone? How do you avoid the funding going to causes that you’d NEVER support if you were alive? For example, if you’re a die-hard libertarian that believes in 100% personal responsibility and limited government, you’d turn over in your grave if your foundation was giving funds to expand the welfare state in your country, right? How do you ensure this doesn’t happen?
*************************
(END LEGACY CHALLENGES)
These are the main challenges you need to address if you want to leave a positive, powerful legacy that lasts for multiple generations.
Without further ado, let’s get right to those Long-Term Legacy Solutions NOW, shall we friend!!
******************************
Long-Term Legacy Solution #1: EMPOWER Your Heirs with True Wealth
******************************
As I stated earlier, it’s vital you address the challenges of how much wealth to leave your heirs so they are empowered and not made lazy or embarrassments to your family, and to address the root causes of squandering your wealth through training and modeling the best skillsets, morals, and values to your heirs.
Here are the 3 steps I recommend you take ASAP to empower your heirs with true lasting wealth:
Step A: Commit to yearly passing on your inheritance to your family so they are NOW empowered to manage what you’ve built once you’re gone.
The best way to do this is the following:
i. Host your Family Vault Meetings every year so that your skillets, morals, and values are passed on to all family members yearly, and at each FVM make decisions as a family with your Family Counsel. This way you both learn from each others’ experiences AND actively make decisions together as a family. This will help ensure everyone in your family is actively involved in building and strengthening your family. :)
ii. Invite your heirs to do small things in your family biz at first, then invite them to do more and more things as their interest and skills grow; look to give them tasks to do that utilize their strengths, and through this process, you may create the desire in one or more of your heirs to manage your family business. To avoid entitlement in your kids (Pride comes before a fall, King Solomon warns us), regularly remind them that your family success was earned with skill development and focused work, and make them work in your business to earn positions of management. This way they’ll manage your business much better long-term.
iii. Do charity work together every year. Do this by deciding what charities to support and reviewing the results your charitable work produced in the past year in your Family Counsel meetings, AND by volunteering your time to charities as a family and discussing what the experience was like for each family member.
Step B: Seek wisdom from advisors on how much money to leave to your family and how much money to leave to charity.
King Solomon said that a wise man leaves an inheritance to his children’s children, and as we discussed earlier hosting your FVMs yearly is the best way to empower your heirs with their true inheritance of your skills, knowledge, and values.
Once you’re doing that, the next step is to decide how much financial wealth to leave to charity and how much to leave to your heirs. Leaving all your money to charity is unkind to your heirs, and leaving all your money to your heirs is unkind as well as it will tempt them to be lazy. As such, it’s wisest to give a portion of your financial wealth to both charity and your heirs.
There is no hard and fast rule on how much money to give your heirs. As such, you need great discernment in making these decisions. Based on my study of many successful families, I recommend you follow this system for leaving money to your heirs:
Whether in their allowance or income, a trust you’ve set up for them, or in a loan your Family Vault gave them to start a business, start by leaving them small amounts at first and larger amounts later. The ancient maxim “he who is faithful with little will be faithful with much” applies here; hold the funds accountable, and make it clear that your accountability is to empower your heirs to wisely manage funds so they are successful in life, NOT to control them.
I highly recommend you share how you’re managing the family wealth with your heirs during your FVMs as well (share details on an age-appropriate basis depending on how involved family members are in your family business). Demonstrating trust, humility, and leadership in this way will help to build strong trust in your family.
Step C: Measure how well your heirs are managing wealth you’ve left them already.
As soon as your heirs can add/subtract/multiply at 6 or 7 years old, follow the Rockefeller rules: give 10% of your income to charity, then track what you do with the other 90%. ALL results improve with measurement and accountability, so the more of this you do as a family, the better!
******************************
Long-Term Legacy Solution #2: Avoid/Heal Family Bitterness
******************************
This is some of the hardest work you’ll do as a family to leave a powerful legacy, and it’s also some of the most important work you’ll do as a family as well. Why?
You’re likely very successful already now and committed to maximum success for yourself and your family moving forward. Like most driven, successful people, you are great at focusing on your work. A big challenge most successful people like you face is that it’s easy to be so engulfed in your work that you neglect to spend enough time with your family, which often leads to disempowerment and bitterness.
What are the best ways to address these 2 challenges of disempowerment and bitterness?
a. Do charity work together as a family. This not only is a bonding experience for your whole family; it also has many extra benefits as well! It grows responsibility, empowerment, empathy for those less fortunate, and gratitude in the hearts of your heirs. Now those are some GREAT side effects, aren’t they!
b. Affirm your family members for who they are, not just what they do. As a parent, it’s easy to only affirm our kids for good behavior. And as you’re a high performer, your children likely feel great pressure to live up to your and others’ expectations to be like you. The combination of these 2 factors likely has driven your kids to either work their butt off to win your approval, or to give up on trying to impress you.
Whether they’ve worked hard to win your approval or not, either way your kids have likely wondered if they are “good enough” for you. To address this challenge most powerfully, affirming them for WHO THEY ARE will help heal past wounds of rejection so your heirs will carry on your legacy with maximum power, contentment, joy, love, and impact.
How do you do this? Begin by writing down what you appreciate about each member of your family. Write down their strengths and skills- the positive things that make them unique that you appreciate.
Next, as soon as possible tell them that you love them for who they are, you’re glad they’re in your life, and tell them some of the things you appreciate about them. Ideally tell them this in person or at the least on video chat or the phone. Don’t send them this message via text or email; let them hear your emotion so that your validation really touches their heart.
Most of our culture is performance-based, so your validation of your heirs as an important part of your family will mean a lot to them. Lastly, affirm your family members regularly. In Jewish culture, parents verbally bless and affirm their kids weekly, and Jewish people are 30% of the Forbes 400 list. Your tongue has the power to give life and to destroy; choose to speak life into your family, and watch them flourish!
******************************
Long-Term Legacy Solution #3: Clear Charity Objectives
******************************
With your family charity strategy, it’s vital that you are very clear on your objectives. The first thing you should decide is whether to set up a spend-down foundation or a perpetual one.
PROS- you have a say in how your charity funds are invested while you’re alive, and you get the satisfaction of seeing greater results from your giving AS LONG AS you hold the charities you donate to accountable.
CONS: your donations stop after you’re gone, limiting your ability to empower charities long-term. As such, going this route make sure you set a target age/date for all your $ to be spent (I recommend age 85).
PROS- you can support charities for multiple generations, creating a continuity of relationships.
CONS: your family must manage investments that produce cashflow to give to charities; as such, it’s a much bigger commitment.
Seeing if your heirs want to manage your business after you’re gone or if they want to run their own businesses can help you determine if a spend-down or perpetual foundation makes the most sense for your family. ALSO if your kids are passionate about supporting the same type charities as you, a perpetual foundation may make more sense for you. Discuss all these factors, then decide what’s best for you.
The second objective to clarify is how to operate your foundation. Whether it’s a spend-down or perpetual one, be clear on your qualifications for managers, what qualifications are for the charities you give to, and how to communicate with/hold charities accountable on an on-going basis. I recommend you put these details in your foundation’s by-laws so they’re followed, especially with a perpetual foundation.
Lastly, determine how you’ll work with charities. I recommend you make submitting 2-page quarterly accountability reports a REQUIREMENT for charities you work with in your foundation’s by-laws, and reinforce this to your family in Family Vault meetings as well. Have your whole family review the results of your giving every year, so even young kids get in the habit of directing resources towards endeavors that are producing a good return.
***********************************
(end Long-Term Legacy Solutions)
Well, there you have it, friend. When you follow the formula above, you’ll leave a powerful, lasting legacy.
You can’t buy love, but you’ll empower your family with deeper love for each other and their fellow man.
You can’t buy eternal youth, and by involving your family in your charitable work you’ll empower them with youthful energy, excitement, and hope for the future as you see yourselves make a positive difference in the world.
You can’t buy eternal life, but by investing your life strategically and leaving wealth to both your heirs and charities, you’ll enrich the world, be thought of fondly, and be making a positive impact on others through your family 30, 50, perhaps even 100 or 300 years after you’re gone.
Now THAT’s a legacy to get excited about leaving, isn’t it!!!
I congratulate you for wisely investing your time in reading through this report. To maximize your R.O.I. from your time investment, I invite you to now do the following things:
1. Review your written notes from reading this report, and create a written action plan for the items you need to implement to maximize your family legacy.
2. Go over your action plan with your spouse and schedule dates to implement your family’s Lasting Legacy plan.
3. To maximize your results implementing your newly improved family legacy plan, contact my office to request a Legacy Builders consultation. We offer a variety of training and consulting services to help successful families like yours ensure they DON’T throw away everything they’ve worked so hard to achieve, and to help you maximize your family legacy ASAP. During our consultation together, we’ll determine which of our programs, if any, are the best fit for you and your family’s specific objectives. Request your consultation here!
