Generational wealth. What's behind the obsession?
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Anonymous
| You don’t need to worry about generational wealth because people take care of it with procreation. My great grandfather made a ton of money and nobody squandered much of it, but for 1/70th of a fortune to be a lot, it has to have started out really enormous. |
Anonymous
Meh, my DH and his siblings have a trust fund and all of them work. One runs a farm and is at the farmers market each weekend and works her ass off, one works as ski patrol in winter and MTB patrol in summer, and my DH works in education but i do not want to get too specific here. The difference is the all do "work" they love. The principal of the trust is not even touched, there are rules and it is a whole process to get any extra money than the alloted and nobody has even tried it. The truest basucally gows on its own and is the money maker. |
Anonymous
Not getting your point. PP said they don’t care if their kids just travel and enjoy life. Also, you admit that the principal of the trust can be touched…just that your DH and siblings haven’t. It just takes a couple of dumbf**ks to go after the principal (and they will get it…the trustee has little incentive to fight it) and blow it. |
Anonymous
You are correct…but that’s not generational wealth then. |
Anonymous
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“fly first class or your kids will”
And yes to all the PP’s, if the kids never get a job and no outside income ever comes in, you can blow through a lot of money very fast. My parents are very frugal and also fairly wealthy. They pay for all grandkids private schools but live modestly. I wish they would spend more on their lives but they won’t. Don’t get me wrong—they travel to Europe, have 2 homes, but they could definitely spend more. I guess it’s good for the generations. I’ll fly first class. |
Anonymous
I suppose? but it is not easy. Has to be approved and theres narrow list of qualifiers. Something pretty devastating would have to happen thst the normal generous disbursements could not cover. |
Anonymous
Often times they may allow for capital to start a business and other “good” reasons that can easily be abused. The biggest issue is the trustee doesn’t want to be sued…if the request passes muster, they aren’t going to decline because they think it’s a bad idea. |
Anonymous
That was poor planning on the grandfathers part and poor advice from whoever set up the trusts. The trusts should have had professional trustees with that amount of money involved. I doubt there was any thinking of preserving money for future generation. If they had been generational trusts, the money would have been more tightly controlled. It would be used for housing, education, household needs, medical, vacations etc. The trustee would ask the beneficiaries to fill out a form listing all of the their expenses and the trustee would send a monthly payment. If a car was needed, new housing, the trustee would wire the money directly to the dealership or real estate agent. That’s how you preserve money and leave incentive for them to work if they want some kind of lavish lifestyle. |
Anonymous
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I don’t understand OPs question. If you work and live below your means, you accumulate wealth and pass it on. This is just simple math and not an obsession. Teach good hardworking values to your kids.
Everyone should work, even if part-time. Gives you a sense of purpose, meaning, social outlet and keeps the mind sharp. I no longer need to work for money even though I still have 2 kids who haven’t started college yet and I plan to pay for it. But I love my job in healthcare and love helping others. I would be depressed if I didn’t work. 3 generations from now, I have no idea if they’ll blow the money but that doesn’t mean I should blow it now. |
Anonymous
Why are your parents paying for your kids private school? Don't you guys have income? Or just put them in public school. |
Anonymous
Not sure how many times it needs to be said, but often times these trusts allow for significant capital for a business as one example. That sounds like a “good” use of funds, but can be easily abused. A professional trustee isn’t going to be able to deny the money because it’s a bad business idea…they only do what the trust guidelines indicate. The problem is that the kids and grandkids weren’t raised with a strong work ethic. A motivated heir who really wants the principal will get their hands on it one way or another. |
Anonymous
My parents pay for private school because it’s generational wealth and a way to pass down money without tax implications. We have incomes. |
Anonymous
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not in this position myself by goal is for each generation to be in a better spot financially than the one before.
I've seen that passing down enough such that later generations don't have to work has led to a lot of issues. |
Anonymous
The trustee will abide by the terms that the grantor set. The grantor could instruct no distributions for opening a business. There can be four grandchildren with four different needs. Instructions to the trustee can be tailored to each individual’s needs. |
Anonymous
Where exactly do you find these satisfying part time jobs?  Most part time work is in service sector where you are working for close to minimum wage and under the foot of of the supervisors and customers in your face. Not always pleasant or keeping your mind sharp. Driving uber or doing uber eats is a bit more pleasant if you like driving around and going places. The rest if the jobs you make for yourself, and to get there, you usually have to invest a lot of years of hard full time work. To grow some private practice, to establish yourself as a consultant, start a business where you don't have to show up every day, etc. Most of it is hobby stuff anyway. Reality of working for vast majority of people is grind.
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