Generational Wealth Inspiration

Generational Wealth Inspiration

When it comes to building wealth, growing your net-worth is half the battle. Building lasting wealth involves creating a plan for how it will be transferred and passed down to the next generation. This is known as generational wealth.

Figures from Gobankingrates show that 70% of wealthy families lose their wealth by the next generation, and 90% of wealthy families in the next generation loose the wealth as well. Succession & the transfer of wealth is something that our country is drowning in, even amongst the wealthy in the 21st century!

What is generational wealth?
Generational wealth is essentially any kind of asset that is passed down from one generation to the next. This might include cash, insurance, trust, investment funds, stocks, cd's, bonds, real estate properties, or even businesses. It’s projected that more than $80 trillion will be passed down from today’s older generations to their children and other heirs over the next two decades, but multigenerational wealth is not equal across the board.

The most recent Survey of Consumer Finances found that the typical white families have eight times the wealth of the typical Black family and five times the wealth of the typical Hispanic family. This wealth gap can be seen across different areas of the financial industry because of the role that adequate wealth plays in consumer decisions and behavior. Wealthier families are less likely to be saddled with debt; they have an easier path to homeownership, and likely more capital to continue to grow their wealth through businesses and investments.

What are some challenges to building generational wealth?
There are several factors people across income levels, race, gender, mental health, lack of exposure, religious beliefs and various levels of education that make it more difficult, or in some cases easier, to build and transfer wealth from one generation to the next. I grew up in a home that promoted and instilled christian values which was a tremendous benefit. But many of us that were raised in christian families were taught about spirituality, love, faith, character, and generosity, but were heavily un-educated, alienated, and ignorant about the understanding of generational wealth. Remember, it's important to understand Jesus Christ gives us a free gift called salvation (eternal life.) But generational wealth is something that is inherited, or earned collectively, or individually by being intentional, relational, and educated. 

Differing levels of financial literacy
Building wealth and maintaining it takes a certain level of understanding that not every consumer has. Always remember, Wealth is first Spiritual, (Totality) Mental, Emotional, and Physical within this order. The level of consciousness, and ownership that you have obtained has a lot to do with how money will be translated into your everyday life.

Substantial wage gaps
Disparities in pay across different racial groups play a role in each generation’s ability to build enough wealth to pass on. According to the most recent figures (https://www.dol.gov/agencies/ofccp/about/data/earnings/race-and-ethnicity) from the Department of Labor, Many families shy away from having conversations about what will happen to specific assets when a family member falls ill or passes away. “Start the conversation with your loved ones and heirs about money. A step forward to achieve this goal is to plan regular family meetings quarterly or semiannually,” says Curry. “The consistency of meetings provides an opportunity to reconnect and share the family’s vision for the future. The conversations also help the next generation learn and understand finances.”

3 ways to build and protect generational wealth
Your path to building wealth that lasts more than a generation or two will look different from everyone else’s, however there are certain strategies you can use to set yourself up to thrive. Understanding that each family might have their own vision of how they want to build wealth, receive wealth, and transfer wealth.

Don’t wait to start investing in you
Investing starts with your mind before it's starts with your money. Don't be so fast to define the word investing. Your mind is your greatest tool, and your money is your greatest slave that submits to your level of understanding. Even if you don’t have a ton of money to invest, start with educating yourself about how the law of your mind works, and how money works. The greatest investment you can ever make is in yourself (personal development). You will forever externally chase many different opportunities, until you discover your own niche, and personal value. Leaders are readers, and generational wealth is a result of those that take action.

Develop multiple streams of income
With inflation on the rise, many Americans are looking for extra ways to earn income. Saving and investing for your future self and those that come after you means having enough funds to cover your expenses in the present. 

Create a legacy strategy

Caring.com (http://caring.com/) found that only 33% of Americans have a living will or trust, and one in three Americans who have no will or living trust claim they don’t have enough assets to leave behind. But focusing on the short term could cost you and your loved ones down the line. Regardless of what you have now or what you think the future holds, having documents in place that ensure a smooth transfer of whatever assets you do leave behind protects the wealth you’ve built and gives the next generation a foundation to start from.

“The most important thing to do when you are building generational wealth is to surround yourself with a team that will help you accomplish your objectives,”. “Your team should include not only your estate planning attorney, but your tax adviser and your financial adviser.”
These experts can help you create a trust for your beneficiaries that clearly outlines how your wealth should be distributed and invested, and who will be entrusted with your assets.“These are all pitfalls that can get in the way of your legacy lasting for generations, and so you will want to carefully think about who you name as a trustee of your trust, and the terms of distribution. If you are concerned that your child may not have the skill set to invest wisely, for example, you can name a professional to take that responsibility off their shoulders,”.

Blog Disclaimer Easement - 
This informative Blog on Generational Wealth is only given for inspiration, and encouragement. We are not certified, or professional financial advisors. By reading this, you understand that your personally held liable for the generational wealth choices you make. Please consult with your own advisors before making any kind of generational wealth decision pertaining to your personal estate.