Three Questions That Will Extend Your Wealth for Generations
We long for our life to matter. To leave this earth knowing it is in a better place because we were here, or at least the part of the world we touched. If you are wired to make an impact, wealth matters, especially in the lives of those who are most important to us.
Legacy is so much more than just how our loved ones remember us. Thirty years from now, will anyone still see your tracks? Unless we are strategic and take action, in one generation, no one (including our loved ones) will even know we were here. You can leave BIG tracks and lots of them. The longer your time horizon, the longer your tracks will last. We can all think of people whose tracks are embedded hundreds of years after they made them.
We can have an incredible impact on the people most important to us. Smart families even extend their wealth and legacy through several generations
Our legacy, like our wealth, has five types of capital:
- Financial – This is typically the first and often the only category to come to mind. How do we invest our currency of money in the people and causes that are most important to us?
Intellectual – How much creativity and knowledge do we have to invest? This currency involves the valuable concepts, principles, ideas and truths we have acquired. How will the next generations inherit and capitalize on what we’ve learned in a lifetime?
Emotional – The quality of the relationships we have in our family, with friends and through our network is typically our most cherished asset. Protecting and investing more in these relationships compounds our wealth and legacy.
Character – How much integrity do you have to invest? People do what we do, not what we say. This is a currency that is caught much more than it is taught. What work ethic, motivation, attitude and morality are you modeling?
Spiritual – What amount of spiritual assets do you have to pass on? How will you pass the currency of wisdom, spiritual lessons/experiences and faith to future generations?
Our legacy, like our wealth, will grow as we make deposits in each asset class. Our value to current and future generations grows as we pass more forms of capital to them. This provides a better platform from which they can launch. The key question for each form of capital is “What do I want to accomplish by leaving this form of capital?”
Here are three life and legacy changing questions:
1. If you could only pass one form of capital to the next generations what would it be?
2. If you could pass four forms of capital but had to bankrupt one form of capital to do that, what would you bankrupt?
3. Why are we spending so much money and energy to pass financial capital while ignoring the other forms of capital?
We can have an incredible impact on the people most important to us. Smart families even extend their wealth and legacy through several generations. Unfortunately, the current estate planning process only deals with one form of capital and one or two generations. As a result, much of our capital rarely impacts more than one generation. What a loss!