Let me start with a disclaimer. This is not my opinion, this is opinion expressed by guest poster Bill. If we ever get a kid, we will leave almost everything for him/her in our will. I think many of us think the same way. Still, no harm in listening to the other side of the argument. Enjoy the post and leave your opinion and thoughts.
Everybody always wants to know why I’ll not leave my fortunes to my kids. In this blog post I’ll talk about the following:
- The pros of not giving my children my fortunes.
- The cons of not doing so.
- Why warren buffet said he would give 99% of his wealth to charity
- How to appreciate your wealth by sharing with other people i.e. the needy.
- How to teach your children to build their own wealth without depending on your investment.
Are you ready for the insight?
Ok, lets rock
There are many good reasons. One of the most important is that I’m simply following the example of some of the richest men in the world, who have all said they would leave only a small percentage of their estate to their heirs.
For example, Warren Buffet has famously said that he would give away 99% of his wealth.
He told the Gates Foundation that he would leave his kids just enough that they would feel they could achieve anything but not so much that they would not want to do anything.
This is also why I prepay my mortgage since I don’t want to leave my children with debt.
Here are some pros of my decision not to give my children a BIG inheritance.
- I want my children to learn valuable lessons about money. I recently asked them to read the blog post What I Want My Kids to Know About Money so that they’ll realize the importance of living below their means so that they can avoid going into debt to support their lifestyle.
- I want them to learn valuable career lessons. Forbes magazine recently published an article on the twenty things that twenty-year olds don’t get, explaining some of the valuable lessons that young people should know in order to build their careers. Why would they be motivated to build a career if they have enough money that they don’t have to work?
- I don’t want them to grow up spoiled. I’m not rich enough for my children to afford services for the super-rich or swanky lifestyles in Meadow Lane, the so-called “Billionaires Lane” in the Hamptons. But I also know that if I left them my fortune, they would not appreciate the value of money.
- They might decide to keep their finances separate from their spouses. As explained in the blog post Separate Finances: A Recipe for Marital Disaster separate finances would discourage spouses from turning their marriage into a genuine partnership since they would be encouraged to spend what they want without being accountable to each other. This would encourage them to be selfish, in other words, instead of considering how their use of their finances would impact their family.
- I want them to appreciate the value of sharing with others. This is why many billionaires are opting not to pass on their fortunes to their children since they want to use their money to help the less fortunate improve their lives, as well as giving back to the community.
On the other hand, there are some cons regarding my decision not to leave money to my children.
- I want them to have enough to invest. I always encourage my children to read blog posts about investing such as My Investment Tips For Younger Look so that they would be able to develop their own investment strategies. However, it takes some money to invest in.
- I want them to have enough to start a life on their own. With times as hard as they are, my children are not earning enough to start families and establish households of their own. If they received my fortune, this would not be a problem for them.
- I want them to have a clear mind in terms of working hard and making their own money rather than depending on the family wealth.
- I don’t want my children to feel that I don’t love them. Of course we have had family discussions regarding how we should not measure affection by how much money that we are willing to spend on each other, but we live in a society where love and money are inextricably linked. When I am gone and people know that I did not leave a lot of money to my children, they might say that I did not love them.
Things to do for your kids
If you don’t want to leave your fortunes to your kids, then I’d recommend that you do the following for your kids.
- Open saving accounts which will enable your kids to save for future needs
- Teach your children on the benefits of investing
- Teach them how to pay off their debt just in-case they have when they grow up.
- Build their investment portfolio so that when they grow up they will know how to manage their investment.
- Pay off their school fees in full so as to avoid any balance
- Instill discipline in terms of money management
- Teach them to spend less especially on their birthdays and vacations
Now you know why I’ll not leave my fortunes to my kids. It is not a decision that we made lightly but it is one that we feel is important to help ensure our children’s future.
After all, the most important legacy that we can ultimately leave them is not money but the life lessons that we have imparted to them that will enable them to live their lives well. Well, I know most of you are divided in whether to go this route, but all in all we need to make wise decision when allocating our wealth to our dependents.
Definitely I know this blog post will cause a lot of debate but it’s just my opinion. If you have a burning question in regards to not leaving wealth to your Kids, kindly leave your comments for intensive discussion.
Have a happy wealthy Day!!!
About the Author: Bill Achola has asked repeatedly to be called ”His Royal Awesomeness” but no one listens to him. So, he settles for CEO of EBusiness Reviews, LLC. Poor man. He is the author of www.eBusinessReviews.net a practical blog that helps bloggers and investors to make wise decision before they invest.