A report published in 2012 by Pew Research Center shows that fully 50% of successful individuals worry that their children, or other heirs, do not have the proper financial skills to handle inherited wealth. If half are concerned about this, it’s likely that the other half should be.
In 1877, when Cornelius Vanderbilt died, he was the richest man in the nation. The famed railroad tycoon’s estate valued at over $105 million at the time. On his deathbed, he put his son, William, in charge of managing and protecting the family fortune he worked so hard to build. Sadly, William was ill-prepared to manage such an enormous estate. It’s said he had great experience in spending money, but none in protecting and growing it.
Knowing this, it’s not surprising that just under one hundred years later, not one millionaire was present at the 1973 Vanderbilt family reunion where 120 descendants gathered in Nashville. Vanderbilt’s grandson, William, said this about handling the family fortune,”It has left me with nothing to hope for, nothing definite to seek or strive for. Inherited wealth is a real handicap to happiness.”
One can imagine that the younger William would have been much happier had he been properly prepared for the unique challenges and responsibilities of inherited wealth.
Most successful families don’t have wealth approaching that amassed by Cornelius Vanderbilt. Even so, mentoring your children and grandchildren in the great responsibility that accompanies inherited wealth remains vital to future success and an enduring legacy.
Donor-advised funds offer a great opportunity to mentor the younger generation consistently and from an early age. This early involvement goes a long way toward guaranteeing a smooth wealth transition and the successful management of it. Don’t wait another day to begin instructing your future heirs about wealth management principles. With a donor-advised fund, it’s easy and fun for all involved, not to mention that your efforts could have a beneficial and lasting impact on the community.
Enduring Legacy – Family Philanthropy Builds the Foundation
At iGiftFund, we don’t just sponsor your donor-advised fund; we like to think of ourselves as stewards of your fund. We take time to get to know our clients, their specific vision, family values, and philanthropic goals.
With these in mind, we work with you, your trusted advisors, and family members to help you support the charities and causes that honor your mission and legacy. By including the younger generation in the process, you can help them understand sound principals of wealth management and give them a greater sense of purpose.