Give Your Family Its Wings

Are you building your wealth only to see it gone by the time your great, great grandchildren are growing up and asking about their roots? Most families do not keep ancestral footprints. You can change that by creating a living and engaging family history, footprint, and legacy.

According to research done by The Williams Group, who researched families of great wealth,  70% of families with  assets and stories, values and meaning, will find their money gone by the end of the 2nd generation. Shocking? For those 70%, probably yes.

The research continued to find that 90% of families are unable to have their wealth pass on beyond the third generation, in other words, beyond their grandchildren.  Why is this?

Families survive and thrive not by money transfers alone, the above statistic evidences that.  Families stay together because of a “why.” This “why” is the glue that voluntarily keeps them unified. This “why” includes the history of who you are, where you came from, what shaped you. It is your family’s living legacy.

Consider this: the etymology of Legacy according to the Online Etymology Dictionary stems from the 14th Century French: “legate-body of persons sent on a mission”, and from the middle Latin “ambassador or envoy.” Give your family its wings by creating its legacy. This will keep them connected for generations well beyond your initial contributions.

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You Need the Right Focus to Live a Life that Matters

As you may know, the concept of purpose and its practice is key to happiness. Purpose is difficult for many people to grasp because we are encouraged to be constantly on the go, and to fit in, neither of which speak to purpose. It is easy to wander through life and look back at an advanced age and wonder: “What happened? Why am I unsatisfied? What was my purpose?”

What is purpose? The Etymology Dictionary says that “purpose” stems from the 14th century Anglo-French purposer, meaning “to design.” However, purpose did not just appear then, it had already played an essential role in Asia, the Middle East and civilizations going back millenniums. Purpose is a cornerstone to living a life that matters.

Author and co-founding partner of the Australian company, Sonder, Jonathan Hopkins, wrote in a blog wrote: “Successful organizations (like Nike, IKEA, Ben & Jerrys, Lorna Jane, Apple) all have an idealistic purpose which is followed, worshipped and preached by its employees and customers alike. Without a powerful purpose, leaders will struggle to motivate their employees and customers will struggle to find a reason to connect with the organization.”

What is your purpose and how are you expressing that in your community?

3 Tips to Developing Money Stewards at Home

An effective way to view  money at home is to regard money education as a process rather than as a single event instruction. When money education is set up like this, money behaviors can be talked about, tweaked and managed more easily.

Here are 3 tips to get you started in developing money stewardship at home:

1        Begin by asking your family members what money means to them. Once the question has been asked, listen, without interruption to their response. It is critical that you not interrupt so your family members feel listened to. They do not want to feel this was a set up question for judgement and commands. When your children feel heard rather than feeling like they are being judged, they will more likely be candid with you in their response.

2        Put together an agreed to plan of action to develop valuable money habits in these areas: saving, invest, donating, earning, spending, what we at Focus and Sustain call the 5 S.I.D.E.S. of Money©. You will find your children are drawn more to one or two “sides” more than others. Explore these with them. Create limits and challenges for them to explore their interests.

3        Talk about money. Set up money nights where you talk about topics like: budgets for vacations, issues your children are running into, budgets, how to make money choices, etc.  Open  up the dialogue with welcomed feedback, with parameters around accountability, develop measurability to plans. All these will develop stewards to money at home.

Who is Ready for their Inheritance?

If you have young kids, and you are wealthy, are your children wealthy? What about your grandchildren, are they wealthy? When I ask these questions to clients, they inevitable pause. I can almost see the wheels spinning in their heads as they consider the money paradigm  existing in their lives.

 

I often hear how they want their kids and grandkids to understand the value of thrift, to see and appreciate how hard it once was, not take money for granted, and yet also give their children and/or grandchildren opportunities and advantages available to them. But how can your progeny learn about life’s hardships when they have private tutors, unique vacations, and financial ignorance?

 

Money is not often discussed in families with wealth. The Wilmington Trust, in a poll they conducted,  found that sixty seven percent of respondents said they were uncomfortable talking about eventual inheritances and only ten percent provided complete information to their heirs.

 

Concerned that they might thwart motivation, self-worth, and confidence, wealth holders often will askew conversations about money. Hope, intuition, seat of pants guidance are common methodologies, but they are not recipes for success. Trusts and timelines are common tools to allocate money to next generations but neither of these prepare the inheritors from being ready to receive the money. Let me repeat that: neither of these prepare the inheritors from being ready to receive the money. Maybe it’s time to change that paradigm .

 

Prepare your family for their inheritance. Mentor them to become stewards of that which you worked hard and proudly to accumulate.  Ask them what money means to them. Ask them what they would do with money. Give them a small amount of money to see how they handle it. Let them make mistakes while mentoring them towards stewardship.

 

This is such an important topic, rather than avoid or delay talking about money, use the tools that allow you to create an environment of healthy money conversations and stewardship.   Contact me if you want to learn how to talk about money.

 

Money can become just another conversation. But you need to create that environment so when asked: “Who is Ready for their inheritance?” your children and grandchildren can say: “We are. We are stewards to a legacy. And we are ready in our roles and responsibilities to steward our inheritance.”

The Family with a Mission Sets a Cornerstone of Longevity

When I ask people about experiences they have had with the transition of wealth in their families, often, I get a shake of the head followed by a story of at least one person or one family branch creating an issue with the terms of distribution. This is still astounding to me, twenty years plus of asking this question.

Why, today, in our “enlightened states”, where information and coaches are ever present, do we fall into patterns that have been around for centuries? Why do we have to say: “My family is different” or “They get along. They’ll figure it out” only to find our families are right in the mix of fallen, disrupted, and broken families? I really do not get it.

What are we so afraid of uncovering that we would rather avoid, deny or hide it than seek to overcome it?

Many people think that merely preparing the assets for their eventual distribution is the answer to passing on an estate successfully. But those of you who have experienced, or, know of a family where distrust or antipathy, cloaked in polite communication, know a great mistake left  irreparable consequences.  Families are torn apart when instead they could have learned how to stay connected.

Becoming a legacy family means preparing the beneficiaries, your family members, to receive the assets. It means understanding the purpose of the wealth and the purpose of the family so the two can co-exist with agreement, understanding, and with stewardship that passes on what it has received and cultivated to the next generation.  Becoming a legacy family means looking at each other, understanding what you want to accomplish together and finding that place of agreement through shared values and inclusivity. Legacy derives from the word legate or mission. When a family has a mission, it sets a cornerstone of longevity.

I will stop here to give you an opportunity to soak in the essence of what has been conveyed here.

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Photo by Pixabay on Pexels.com

What This Mom Said When Asked Where Squirtle Was

Recently, I went out to a local park which housed a lake, that serves a spot  to heron, beavers, ducks, birds, and turtles. While I was there, the turtle count was 49 on just one log, nestled in the reeds. As I was looking at the turtles from my viewpoint on an extended pier, I head a child ask their parent: “Where is the Squirtle?”

I had to listen to Mom’s response. Her child was sincere in the question and worried that the Squirtle might not at the lake.

There was a slight hesitation as Mom carefully considered her response. She finally replied: “Here, Squirtles are found in their separate characters. Over there is the turtle. See its hard shell. Let’s watch what it does and consider why it does why it does, before we look for the Squirrel, the other part of the Squirtle.”

The child accepted the response and the challenge imbedded in it. Instead of joining the others who knew what was occurring on their phone and tablet screens as they crept through the park, this child began exploring and interacting with the world around her.

It was an incredible contrast in style.

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Wisdom from the Ages Can Be Accessed from this One Tip

I recently read a recommended book. The author, Benjamin Franklin (1706-1790) wrote an autobiography, which was published posthumously in 1868. I would like to share a point that resonates with me and is as relevant today as it was for him, two hundred plus years ago.

To give you a little background, Franklin believed strongly in the attributes virtues had He went so far as to define the thirteen core virtues which were cornerstones to his life.  He defined what each meant to him, and this is insightful,  because he understood that each person defined virtues, individually. His definition was not necessarily theirs and vice versa.

Rather than focus on all thirteen virtues, he isolated one at a time. He started with temperance which he described as: “eat not to dullness, drink not to elevation” and focused on it for a week. He then moved on to the next, which for him, was silence, defined for him as: “speak not but what may benefit others or yourself; avoid trifling conversation”, the next week he focused on order “let all things have their places; resolution “resolve to perform what you ought, perform without fail what you resolve” and so on.

As he focused on only one virtue per week, he could gain greater understanding of it for himself and its valuable application in his life. As the years went by he became dedicated and pronounced with his virtues, refining them in his daily life.   This contributed to the respect he garnished. He took the time to live from his “virtues”, intimately.

Each day he would begin by asking himself: “What good shall I do this day.” In the evening, he would reflect on his morning question by asking: “What good have I done to-day?” using one of the thirteen virtues he was focusing on.

Now, that is Wisdom from the ages.

Smart Money Tips for Kids from 3 to 22

Without a foundation of financial competence, people run the eventual risk of squandering, spending, or squabbling over money. Because of this it is essential to impart financial competence directly and early.

Having an early and repeated exposure to real money, gives children a direct experience with money. Collect coins and sort them into various sizes so your children are introduced to money.  Have them count the total of different coins and bills as an arithmetic and financial exercise. The writer downer here is to introduce them to money itself. Kids relate to the direct experience with it.

Observe your children with money and let them experience it. Be informal yet frequent about your dialogue with them about it. Kids from 5-7 age love games. Games that involve bartering are great activities for them. In this age group introduce them to different ways money is used.  Remember the piggy bank? This is a great time to introduce the piggy bank to your children.

8-11-year old children are at a great age to experience setting limits and making choices. Delayed gratification is an important trait to develop. You may have heard of the Stanford experiments to determine the effect of immediate versus delayed gratification. Delayed gratification correlated with higher SAT scores. It also correlated with self- control.  In this age group, delayed gratification can be expressed in self-determined goals/objectives and even incentives from you.

Preteens love to make buying decisions. They can handle the concept of limits. Have them set limits for themselves. They can understand ramification and consequences to exceeding budgets. Have them make budgets, not as tedious chores, but as a fun activity with gratifying outcomes.

Teens feel the pressure of their peers. This need of belonging can tug at their financial behaviors. “But, you don’t understand, I need this…now!” is a common plea. Reinforce their sense of responsibility by having your teens communicate the “why” of their, a “why” with consequences. This is also a wonderful time to Introduce them to the concept of earning, trading talents and skills for money that does not come from a family member.

Spreading their wings and testing their independent lives, young adults are often thrown into a world of a financial tightrope on which they may feel unprepared to take on. They have so many needs and wants tugging at them. How do they decide when to spend, when to save, how to invest and donate?  This is a time for young adults, if they haven’t already, to identify what money means to them and set up a system they can follow to save, invest, donate, earn, and spend.

We Need More Money Nights at Home

At a recent Ivy League School alumnae dinner, the host asked the attendees, to indicate, by a show of hands, if they engaged in financial discussions with their children and/or grandchildren on a monthly or more frequent basis? Of the 100 attendees, how many hands do you think went up?  3 raised their hands.

What did I glean from this? That few families have “money nights” at home. Although 17 states require a “course”, only 5 states require a stand-alone semester in personal finance before graduation from high school. We are not one of them.

It is up to us, the family, to teach kids about money. As Jack Weatherford, former Professor of anthropology at Macalester college in Minnesota, and award the Order of the Polar Star, Mongolia’s highest national honor for foreigners, pointed out: “…money is uniquely human. No version or analog of it exists among any members of the animal kingdom. We have to pass on its meaning to our future money stewards.”

Then how do we talk to our kids about money? Well it depends on their age, inclinations, and maturity. As you introduce money conversations/money nights and money stewardship at home, remember to guide and advise rather than dictate, encourage rather than criticize, be consistent, be flexible, be objective and purposeful about money, keep extended family members in the loop about your financial “rules”, be open to questions, mistakes, and ideas your children might have. Encourage accountability and praise their successes. Money just needs to become another conversation.

When children experience money early they will discover, tweak, and learn from their decisions, mistakes, and challenges. They will become familiar with money and its various facets. They will experience how to use it productively, so they can become stewards of money. This is what we all want.

How is money communicated in your home? Let me know I’d like to know.

Oops, I Made a Mistake

Whether you are 15, 115, or somewhere in between, the life you are building is the life you will leave for others to remember you by.

I thought about this yesterday after I was adamant on making a point instead of understanding another’s point of view. When my perspective was called out, I paused to reflect on my conduct. In this particular situation, I realized that I was focusing on the wrong thing.  I was so focused on the point I wanted to make that I was not listening to the other person’s point.

I was embarrassed because it is important for me to live by the values I hold so dear and understanding is one of my top values.

But the reminder that I was insisting on my point, rather than considering the other’s point, was important to hear. After all, if I do not have the aptitude to give space for someone else’s point of view, I am living in a world of potential isolation, unnecessary conflict and separation.

Allowing someone else’s point of view does not mean I have to give mine up or that I have to agree with theirs. It merely means I am letting them be in their thoughts and feelings as I am in mine.