What the 3 Little Pigs Teach Us About Lasting Wealth

The first two focused on speed and ease, building homes from straw and sticks, only to discover they had no way to defend themselves from the Big Bad Wolf. The third pig took the time to build his home with brick, ensuring it could withstand any challenge.

When it comes to wealth planning, there’s a lot we can learn from that third pig. You see, creating generational wealth requires time, expertise, and a sturdy foundation.

Here are three strategies to consider as you craft a generational legacy:

•  A Will or Trust: While a will outlines your wishes for asset distribution, a trust can offer greater control, privacy, and potential tax advantages. We can help you determine which structure best suits your circumstances and goals for your legacy.
• Beneficiary Designations: Regularly review beneficiary designations on your retirement accounts, insurance policies, and other assets. These designations often supersede your will, making it crucial to ensure they are up to date.
• Gifting Strategies: Annual gift tax exclusions allow you to transfer a certain amount of wealth each year without incurring gift taxes. This can reduce the size of your taxable estate over time and provide immediate benefits to your loved ones.

• Family Mission and Values Statement: Define the core values you want your family’s wealth to represent. This could be a commitment to philanthropy, education, or entrepreneurship. A shared mission creates a sense of purpose and unity.
• Communication Protocols: Establish rules for how family members communicate about financial matters. Regular meetings can provide a structured forum for discussing investments, philanthropic goals, and other key decisions, preventing misunderstandings and conflict.
• Succession Planning: Designate roles and responsibilities for managing family assets and trusts. This proactive approach ensures a smooth transition of leadership and decision-making authority from one generation to the next.
• Formal Agreements: Consider creating a family constitution that outlines the rules and expectations for how the family’s shared wealth will be managed and distributed. This provides a clear, legally binding framework for all involved.

• Family Business: For many families, the business is the engine that drives generational wealth. It is essential to have a clear succession plan for leadership and ownership, as well as a defined process for how the business’s success contributes to the family’s broader financial goals.
• Trustee: A trustee is the individual appointed to manage the assets held within a trust. Their primary responsibility is to act in the best interest of the beneficiaries. They handle everything from managing investments to distributing funds for education, healthcare, or other needs you’ve specified. This role is about diligent and professional care of the wealth you’ve set aside.
• The Executor: The executor is the person you name in your will to manage your estate. Their job is to carry out the instructions in your will. This includes a number of administrative tasks, such as locating and valuing all of your assets, paying any outstanding debts and taxes, and distributing the remaining property to your beneficiaries. The executor ensures your final wishes are fulfilled accurately and legally, serving as the steward of your estate and your final instructions.

Building a generational legacy requires careful planning, a long-term perspective, and a commitment to educating your loved ones. Unlike the three little pigs, you have help. Let’s schedule a meeting to discuss your specific goals and create a tailored strategy to help you build a lasting legacy for generations ahead.