How often do you think about legacy?
Do you feel legacy is within your reach?
And what does legacy even mean to you?
The adage, “The best things come to those who wait,” is the opposite of creating a legacy that lasts.
Delay can be costly.
Time lost.
Delay creates consequences from a tax perspective, increasing insurance costs, and most importantly may create entitlement.
Without being an example, or having critical conversations, or investing in your heirs, or setting up some basic and important items to protect your money, it can cost you a fortune.
Why is legacy often delayed, ignored, or destroyed?
Well…
Life is busy.
Most plans are boilerplate.
Starting late.
Bad advice.
Family turmoil.
Financial surprises.
Divorce.
Health issues.
Feeling insecure.
Lack of attention.
Lack of or no philosophy.
It doesn’t have to be this way.
And you don’t have to wait until you’re getting close to your deathbed or ridiculously rich to create and live your legacy.
You can start today.
Legacy is within reach.
It is a choice.
An act of love.
Building legacy requires time, intention, and attention.
Legacy is about progress over perfection.
It is about having imperfect conversations with family along the way.
Any conversation that speaks a better life into existence, connects you to those you love, and improves your life is legacy.
You can speak your legacy into existence by creating traditions, sharing gratitude, love, and stories to illustrate lessons and demonstrate resilience.
Legacy is not a do-it-yourself game.
Having a comprehensive, cohesive, and coordinated financial team is crucial.
Having retreats with your family to clarify values, create traditions, and have fun together.
Legacy is a game of collaboration.
It is within reach.
Regardless of the money you currently have or don’t have.
If you are rich or just getting by.
I started thinking about my legacy at nineteen.
I bought my first house that year with my parents’ help.
I was going into my junior year in college.
And even though I wasn’t dating anyone or ready to get married, legacy was on my mind.
One of my first memories about money was thinking if I just had enough, I could help my family. If they had a health issue, I could be there. If they needed a fresh start, I could be of value. I’m talking about cousins, aunts, uncles, parents…family.
If someone has a problem that money can fix, and they have the money or access to it, then there isn’t a problem. I want to be of value, of service, and to provide. This was the start of my legacy. To become the consummate value creator. To remove reliance on banks, to have a perpetual system to help fuel the passions of my posterity.
Money is a measure of the choices we have made, as well as the choices of our family as well. Money is part of legacy. The trust and insurance help protect that legacy, protect the money from the government and any heir feeling entitled.
Pass On Your Values with a “Family Constitution”
Money may only be a part, but a very helpful, instrumental part—especially if we leave behind a set of instructions.
That set of instructions is a Family Constitution. It is the preamble to a trust. A trust is a legal document where you can avoid probate, determine how you want your money to be handled after you are gone, protect it from the government and financial predators…it is a way to own nothing, but control everything.
With a trust, if you start early enough, passing on money tax-free for generations is easy. Something often missing is passing on a set of values, philosophies, and leaving signposts to support your heirs. This may be one of the greatest gifts you can leave.
And again, that is something you can start today.
With a trust, you can spell out how you want the money handled. You can create incentives for your heirs that rewards responsibility and removes entitlement. You can give your heirs access to preferred interest rates and have the family trust grow instead of losing that by paying interest to a bank.
In one generation, you can change your family’s financial destiny.
Destiny.
That’s a strong word. But your choices matter, your family matters, and you can massively impact your family.
Your choices can help your heirs to battle inflation, taxation, and overcome economic turmoil. Your heirs don’t have to be subject to the whims of the federal reserve’s change in interest rates or feel helpless to government debt and spending.
In just one generation, you can eliminate the necessity to pay interest to banks or jump through insurmountable hoops to access money. Your family can earn interest rather than pay it and keep it in the family. Especially when you combine a trust with properly structured, optimally funded whole life insurance.
The Formal Foundations of Legacy
Trusts and insurance. That is the foundation. Without that foundation there is far too much risk and chance.
To illustrate, let’s look at two of the wealthiest families with divergent philosophies. One that used trusts and insurance, and the other that didn’t.
One that built and destroyed wealth and the other that built and kept wealth…for generations.
You don’t have to be wealthy to do some of the most important strategies the wealthy use.
Cornelius Vanderbilts created one of the most substantial fortunes in history. And even though it is rumored his final words were, “Keep the money together,” the Vanderbilt fortune did not last. Without a trust or insurance, combined with having full access to cash combined with a penchant for purchasing and consumption from untrained and uneducated heirs, the Vanderbilts wealth has been decimated.
Good intentions without systems, without a trust, is weighed down by financial gravity. Financial gravity like tax, inflation, economic turmoil, and a propensity to consume (a luxury once enjoyed becomes a necessity).
The best way to deal with financial gravity begins with a family trust (Domestic Asset Protection Trust or a Revocable Family Trust) and whole life insurance.
Whole life is a place to store your cash while creating a permanent death benefit. That death benefit funds the trust upon each heir’s death. Whole life underperforms against other fixed income assets in almost any ten-year period. Yet, in any thirty-year period, whole life outperforms fixed income assets like bonds. With access to cash along the way, minimum guarantees, removing the risk of capital depreciation in times of interest rate fluctuations, and with tax advantages.
The death benefit doesn’t have to be an out-of-pocket cost, or harm your net worth, it can be an asset allocation choice. It can replace your fixed income portfolio and savings.
The benefits are clear.
The Rockefellers are now on their seventh generation of wealth. Growing their assets while still donating over $50 million to charity each year. Over 150 people benefitting from the trust, but not as trust fund babies.
Each time a Rockefeller is born, thirty days later the trust buys a whole life policy on the child. The policy will grow a cash value and a death benefit that is likely to increase over time through dividends. The trust is the beneficiary of the life insurance policies.
The trust defines how and when there can be access to money, at preferred rates to fund business plans, support home purchases and educational pursuits.
Incentive-based.
Without a plan, the Vanderbilts didn’t keep the money together. With trusts and insurance, the Rockefellers are going seven generations strong.
Two wealthy families drastically different outcomes.
What is Legacy to You?
For me, legacy is capturing and sharing my values, philosophies, and lessons with my heirs. I prefer this method over allowing for the media to do it.
Capturing and sharing lessons. Without learning and teaching, future generations are doomed to repeat the lessons again.
Those worth hundreds of millions of dollars are likely to address their legacy, determine their plan, set up a trust, and own insurance to protect against tax. But you don’t have to be considered rich today to plan for wealth and legacy.
The key, just start.
I’m happy to share and help. Grab a free hardcover copy of What Would the Rockefellers Do? from me and my co-author, Michael Isom. We’ll invest in your legacy.
This book has experts from my Family Constitution, the story of the Rockefellers and Vanderbilts and the details of what you can do to build your own legacy.
You deserve it.
Your family deserves it.
You are worth it.
Know you are loved. Know you are valuable.
You’ve got this.
I’ve got your back.
