Your Legacy Is More Than Blood: Embrace the Power of Your Values

Family: The Heart of Building a Financial Legacy

I have three energetic children who inspire me to work hard and be my best. Although it can be challenging at times, they are the driving force behind my motivation and future plans. You are likely also motivated by your family and their future. This is why it's common to view a financial legacy as a way to secure a better life for generations to come. This is a powerful motivation, and it is why most wealth is passed down through inheritance.

I challenge this notion: Your family is not the entirety of your legacy.

Let me explain.

The Great Wealth Transfer

We are in the first half of the “Great Wealth Transfer” with an estimated $84 trillion being transferred from one generation to the next by 2045—the largest transfer of wealth in history. The majority of this wealth, around 86%, will be passed down through inheritance. The rest is expected to be given to charity, primarily by people without children.. ^[1]

So, what’s the issue then? Why not give it all to our family?

First, our family is not our values. While we may value family, and our family may embody our values, it’s unfair to expect them to embody all we care about.

Second, money won’t solve all their problems.

Crafting a Purposeful Legacy

A legacy encompasses more than just money or family. While your family is significant, it's crucial to recognize that they will forge their own paths and may not always carry on your exact values.

While your wealth can be a powerful tool for good, it's the intentional direction of your wealth that will truly create a lasting impact.

A meaningful legacy is a blend of your values, principles, contributions to society, and community influence. The impact you have on your family—the guidance, lessons, and traditions you share—is a priceless gift. While you can't guarantee your family will live out your values after you're gone, the bittersweet beauty of family is that, ultimately, our loved ones will make their own choices. The best we can do is hope they carry a piece of us with them and accept the path they choose to take.

Passing Down More Than Wealth

As Ellen Miley Perry states in Wealth of Wisdom: The Top 50 Questions Wealth Families Ask^[2], “values are caught, not taught."

While many parents want to leave a lasting legacy for their children, they also worry about the potential pitfalls of inheriting a large estate. Many studies suggest that an influx of wealth doesn't necessarily lead to greater happiness^[3].

So, what should you do?

We need to return to values. Your values. That’s the secret sauce.

Blending Family and Philanthropy

Focusing on your personal values is a powerful way to shape a legacy that is both meaningful and lasting. By understanding what matters most to you, you can create a plan that thoughtfully blends family and philanthropy.

Imagine your wealth creating a better life not just for your family, but for your community. By dedicating a portion of your wealth to your values, directly through the causes you care about, you can ensure your legacy has an even greater impact.

The good news is you don’t have to choose between your family and philanthropy. You can thoughtfully plan to care for both. By combining a family-focused estate plan with a philanthropic strategy, you can create a legacy that is both personal and far-reaching.

Instilling Values Through Legacy

There are many options for creating a legacy based on your values, from simple to complex. The most common is charitable giving to organizations that align with what you care about. For example, you could support a local land conservancy, create a scholarship for first-generation college students, support veterans, contribute to women-in-business initiatives, or donate to an animal sanctuary. This could be a small or large percentage of your estate. The right choice will be deeply personal to you.

Other creative options include:

• Education trusts for future generations.

• Family foundations.

• Legacy Donor-Advised Funds that empower your heirs to continue giving to causes that are important to them.

• Social impact investment funds that create a positive social or environmental impact alongside a financial return.

By exploring these options, you can build a legacy that not only preserves your values but also makes a meaningful difference in the world.

Communicate Your Values

Once you've identified your values and determined how they will shape your legacy plan, it's crucial to openly discuss this with your heirs. Understand their values, too. By including them in this process, you can prevent misunderstandings and manage their expectations. This collaborative approach fosters a sense of ownership, which ultimately leads to a more successful outcome for everyone involved.

Additional Resources

Remember, you’re not alone, and neither is your family. There are resources to help you identify your values and shape your legacy.

For those who want to explore this topic further, I recommend the book Wealth of Wisdom: The Top 50 Questions Wealth Families Ask by Tom McCullough and Keith Whitaker.

To help you with this process, Jonesing for Good provides full-service philanthropic advising, including values assessments and non-profit matching.

¹ Cerulli Associates, “Cerulli Anticipates $84 Trillion in Wealth Transfers Through 2045,” press release, Cerulli Associates, January 20, 2022. https://www.cerulli.com/press-releases/cerulli-anticipates-84-trillion-in-wealth-transfers-through-2045

² Tom McCullough and Kieth Whitaker, “Wealth of Wisdom: The Top 50 Questions Wealthy Families Ask” (Toronto: Purposeful Planning Press, 2018), 45

³ Earned vs Inherited Wealth: People who have earned wealth tend to be happier than those who inherit it. Sudden Wealth Syndrome: emotional and psychological distress. Psychological Pitfalls of Inheritance. And on and on.