WHO wouldn’t want to be a trust fund baby? Who wouldn’t want a celebrity lifestyle of traveling around the world in style, partying with the elite, spending summers in yachts, driving the coolest cars, and showering in cash?
And yet when these trust funds were set up, that image must have been the farthest from the minds of those that left the wealth.
Most parents, if not all, work hard to earn and build their riches so that their children can have a shot at a good future. Instead of being spent on parties and luxury items, trust funds have been set supposedly to secure the education of the children or to ensure the continuity of the family business.
But when the material riches exceed the legacy of love for work, self-discipline, and compassion for others, the millions in inheritance money turn into a curse rather than a gift. It can be like giving the latest gadget to a toddler.
In most cases, inheritance money, because it hasn’t been earned and learned from, end up getting wasted on vices or wrong investments.
Gifting money to kids can also be a form of psychological bribe to compensate for all the things we think we messed up in our lifetime.
When this happens, children squander their inheritance as a form of revenge for all the pent-up frustrations they have experienced.
Quarrels and lawsuits over inheritance are common, with previously harmonious relationship destroyed by who gets what and digging decades of issues reaching far back as the when one sibling got more toys than the others.
Are we then over-estimating the importance of leaving an inheritance? Has legacy lost its meaning in a price tag? Are we crippling our kids by making them expect and depend on the properties they can get when we die? Are we teaching them to anticipate our deaths? Are we giving them another set of “toys” to quarrel over?
Warren Buffet (investment genius and author) and Bill Gates (Microsoft co-founder, author, and investor) are two billionaires and philanthropists who believe that their children shouldn’t get much of their fortunes. Much of their riches would be shared by their chosen charitable institutions.
Kevin O’leary, Shark Tank investor and self-made millionaire, even went so far as to say that he’s not leaving any of his wealth to his kids.
This has been supported by a friend of mine who laughingly remarked during her last child’s college graduation that her obligation was done and that from that moment on she’s working and spending for herself. She said that she may not leave an inheritance but she sure would not be begging for her hospital bills!
Leaving little or nothing makes sense as expressed Bill Gates in an interview with Daily Mail in 2011. He explained that their children not getting most of their wealth "… will mean they have to find their own way."
And finding their own way may just be the best legacy we can leave for our children.
More than the millions, the tall buildings, the luxury cars, or the gold watches, maybe a sense of personal fulfillment in being able to earn their own money, work for their own achievements, and be known for their own set of (hopefully good) principles would be our most meaningful gift.