Your Legacy
If you are lying awake asking yourself in the quiet of the night, “What should we do with our wealth when we die?”, please read on because in this article you will find potential answers, next steps, and resources.
By Founder & CEO Scott J. Savage.
Estate Planning, Multi-Generational Planning, Legacy Planning, Gifting Strategies, and Philanthropy Planning. Have you checked these boxes yet in your financial plan? If you are lying awake asking yourself in the quiet of the night, “What should we do with our wealth when we die?”, please read on because in this article you will find potential answers, next steps, and resources.
It's natural to have this nagging question appear out of the blue and then fade for a time, only to resurface when you least expect it. Often it’s the part of the financial plan that you will “get to later.” With this article, my hope is that “later” turns into today once you see how approachable and meaningful this process can be. Here is some encouragement to get you started:
Be intentional – As you tackle the question of your legacy, take time to contemplate what is important to you and your family. Thinking in terms of purpose instead of people first is often very clarifying and exciting.
Create a legacy plan – The best answers to the question of legacy come in the form of a plan, not a single answer. You have options. Consider them and decide which ones are best for you. I believe in the saying, “Failing to plan is planning to fail.”
It’s not one-and-done – This can be a very freeing reality. The plan you create today does not have to be your forever plan. In fact, it likely will not be your forever plan. Revisit your plan every few years and adjust it as your life changes.
Procrastination is the enemy – Now that you know your plan can and will shift over time, it takes the pressure off of the need for life-long perfection. Waiting only makes the task loom larger. There’s peace of mind in knowing that you have set forth guidance for heirs and beneficiaries.
Benefit society sooner than later – Why wait until you’re gone to put your wealth to use in a meaningful cause? Many people take great joy in seeing the impact their wealth is making while they are living. Well-conceived and well-executed philanthropic advice can make an astounding impact right now as well as later.
Prepare for the transfer of wealth – Ideally, the capital that you pass on to the next generation grows, surpassing your own impact on society. On the other hand, it can be a minefield if inheritors aren’t prepared for the responsibility. You can help prepare them now for the potential bias against “silver spoon” wealth, or the guilt and shame that can come from unearned riches.
When you’re ready to begin the journey of a well-conceived legacy plan, please let us know if we may be of help. In the meantime, here are some books and references to prepare you for what you’ll encounter. These are not hypothetical situations. We see the stories in these books play out often.
Worthy Reading:
Engaged Healthy, Wealthy & Wise by Coventry Edwards-Pitt
This book imparts lessons from inheritors and their significant others on how to navigate love, family wealth, and forging their own paths. Edwards-Pitt writes about experiences I have encountered advising many SJS clients through the years. Parents and grandparents instinctively want to help their kids and grandkids, and unwittingly “rob” them of the need to “figure it out” on their own. Emerging adults gain a sense of identity by getting a job, paying their bills, renting an apartment, and often, falling in love. When these emerging adults are shielded from these experiences, they never build their own identities. They aren’t prepared, often lack the tools, and therefore hide from the burden of responsibility. Edwards-Pitt also heroically challenges the status quo in most planning circles that prenuptial agreements are a necessary risk management box that those with inherited wealth must check. Through her experience, she concludes that the human risks of prenuptial agreements outweigh the legal risks. Based on my experience, I agree with her conclusion.
The Myth of the Silver Spoon by Kristin Keffeler
In her book, Keffeler tackles the emotional realities of inherited wealth. Better still, she offers up tactics to transcend negative thinking and behaviors that can come from wealth and money. These include putting words to difficult feelings and gaining a healthy sense of identity. She also delivers experiences and insight into how affluent parents can raise children to avoid entitlement and helplessness while helping them discover and sustain their own personal vision for a fulfilling, impactful life. If you are at the child-rearing or grandchild-enjoying stage of life, this book is a must-read because it not only provides identifiable stories that teach, it gives you methods that, as a family, you can talk about and practice. It’s an ounce of prevention that is worth a pound of cure.
I’d like to say that I "followed all of the parenting rules," and did all this right. But as a parent of four grown children and two young grandchildren, I admit to violating some of the advice offered by these two authors. But their guidance to establish a plan and prepare a vision for “when I’m gone,” that I have done. It can be an amazing journey when done with the right advisor. I’d love to help you and guide you and make it a positive, rewarding experience in your life. If you are open to the offer, let’s get started by understanding your unique circumstances, and having an open, honest discussion. That’s the backdrop, and from it can come the best advice.
Important Disclosure Information:
There is no guarantee investment strategies will be successful. Past performance is no guarantee of future results. Diversification neither assures a profit nor guarantees against a loss in a declining market.
Advisory services are provided by SJS Investment Services, a registered investment advisor (RIA) with the SEC. Registration does not imply a certain level of skill or training. SJS Investment Services does not provide legal or tax advice. Please consult your legal or tax professionals for specific advice.
Statements contained in this article that are not statements of historical fact are intended to be and are forward looking statements. Forward looking statements include expressed expectations of future events and the assumptions on which the expressed expectations are based. All forward looking statements are inherently uncertain as they are based on various expectations and assumptions concerning future events and they are subject to numerous known and unknown risks and uncertainties which could cause actual events or results to differ materially from those projected.
Hyperlinks to third-party information are provided as a convenience.
Suggested Reading
Scott Savage Discusses His Book, "Your Business Exit: Monetizing Your Life’s Work"
SJS Investment Services Founder & CEO Scott Savage sat down with the Family Wealth Alliance to discuss insights from his book, "Your Business Exit: Monetizing Your Life’s Work."
SJS Investment Services Founder & CEO Scott Savage sat down with The Family Wealth Alliance to discuss insights from his book, "Your Business Exit: Monetizing Your Life’s Work." Watch below!
Transcript:
Tom Livergood: Welcome back to Alliance Talks. I'm Tom Livergood founder and CEO of The Family Wealth Alliance. And I'm joined today by Scott Savage. Scott is founder and CEO of SJS Investments. And they're a new member of the Alliance. We're delighted to have you Scott and happy to have you today on this episode.
Scott Savage: Well, it's a pleasure to join you Tom. I'm really excited to be a part of The Family Wealth Alliance, and we're really looking forward to learning, and contributing, and being part of The Family Wealth team.
Tom Livergood: Well, you're contributing today with this segment. And I think our listeners really neat to hear this. You recently put out an ebook called Your Business Exit: Monetizing Your Life's Work, which is really a terrific resource for clients with a unique take on business succession. And what I call a next chapter. Please tell us a little bit about the book and why you chose to write it, Scott.
Scott Savage: Well, we work with so many business owners and as a business owner myself, I started SJS 25 years ago. And as a business owner myself, I can really empathize with some of the issues and questions that our business owner clients have. And so there's that real connection that I feel to a business owner that we're advising. And so I thought, well, there are some lessons that I think I can bring on behalf of all this experience that I've had advising business owners over the years. And I thought, well, I'll get it out there in the ether. And hopefully help people avoid some of the pitfalls that are often made in this process by people who are generally selling a business one time in their life. And so you get one chance at doing it right.
Tom Livergood: I really liked that last point that you really have one chance to do it and you want to do it right. And I think that resonates more than anything that you've said. There's an interesting component that you've alluded to Scott, and of their resource mentioned in the subtitle, which is how to manage the financials and the emotions so that you can leave on your own terms. Business owners certainly would relate leaving on their own term, but the psychological journey I'd love for you to talk about. Because I wouldn't think that'd be top of mind with business owners as they prepare their deal team, as you've talked. Can you explain why you chose to address that particular aspect?
Scott Savage: Well, it's like the gold medal athlete bit. Wins the gold medal, stands on the podium, goes to bed that night and wakes up the next day, depressed and down. And I've had dozens of experiences of clients that have properly prepared to sell a business, sell a business on their terms financially and wake up the next day, feeling very, very down. And so to me, it's important that just let somebody know ahead of time, hey, look, this is how you're going to feel the day after you closed. And so then when it happens, they know, oh my gosh, this is normal. I'm in a big canoe and I'll get through that. But it's a really big component whether you're selling to family members, or to private equity, or to a strategic buyer. Irrespective when that life's journey kind of comes to an end or is monetized, it's a tough psychological leap that people need to make. And I just thought, gosh, let's give them a heads up about that.
Tom Livergood: Yeah. I think that's really smart. I know that parents can do a similar analogy about getting their kids ready to go to college, right. And it's just so exciting and the buildup and all that, and the selection, you drop them off and you leave and,
Scott Savage: And you're going to cry.
Tom Livergood : You're not happy. Right. No, I get it. Business owners really do go through a lot and you've given a lot of thought and consideration. What's the, maybe the one piece of advice that you would leave with them in preparing for that transition?
Scott Savage: Well, I think in this country, Tom, I'm sure you'll agree that the way to create wealth in our country is still through a very concentrated bet on a certain industry, oftentimes in one geography. So having all your eggs in one basket, and this person has been watching that basket for sometimes decades. But the job is to monetize that basket. The job becomes then to preserve and protect what you've spent your life creating. And it's a very different mindset. You give up a lot of control. A lot of people have a really tough time with that transition of depending on the financial markets to send them their paycheck in the future. So their financial issues, and there are emotional issues, and they're absolutely connected.
Tom Livergood: Yeah. Well, Scott, thanks for sharing. I appreciate your insights. Very grateful that you've joined me on this episode for a discussion about this. If you haven't picked it up, get SJS Investments ebook, Your Business Exit: Monetizing Your Life's Work. You can find it on your screen here. You can go to our resource and SJS's. But you've done great work as a leader at SJS Investments, Scott. And we appreciate you sharing that today. That's all we have time for. Thank you for joining us for another installment of Alliance Talks. Make it a great day.
Important Disclosure Information:
There is no guarantee investment strategies will be successful. Past performance is no guarantee of future results. Diversification neither assures a profit nor guarantees against a loss in a declining market.
Advisory services are provided by SJS Investment Services, a registered investment advisor (RIA) with the SEC. Registration does not imply a certain level of skill or training. SJS Investment Services does not provide legal or tax advice. Please consult your legal or tax professionals for specific advice. This material has been prepared for informational purposes only.
Statements contained in this video that are not statements of historical fact are intended to be and are forward looking statements. Forward looking statements include expressed expectations of future events and the assumptions on which the expressed expectations are based. All forward looking statements are inherently uncertain as they are based on various expectations and assumptions concerning future events and they are subject to numerous known and unknown risks and uncertainties which could cause actual events or results to differ materially from those projected.
Hyperlinks to third-party information are provided as a convenience and we disclaim any responsibility for information, services or products found on websites or other information linked hereto.