Think Generational Wealth

Ep 117: Rethinking Inheritance: Financial Independence, Family Dynamics, and Societal Impact

• Amir Estimo • Season 6 • Episode 117

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Could leaving your children without an inheritance be the best gift you can give them? Jackie Chan's controversial decision not to pass his wealth to his children serves as a springboard for our discussion on whether parents should prioritize financial independence over inheritance. With only 26% of Americans planning to leave an inheritance, we explore the cultural and generational shifts influencing these choices. Our conversation dives deep into the personal values and societal norms that shape our views on financial legacies, encouraging reflection on the emotional and financial impact of these decisions on future generations.

Join me as I untangle the intricate web of family dynamics affected by inheritance. From disputes that fracture sibling relationships to the societal expectations tied to wealth, I examine the profound psychological and cultural effects of inheritance. I contrast Western and Eastern approaches to financial literacy, questioning the role of the American education system in preparing future generations. With insights into the trend of "giving while living," highlighted by figures like MacKenzie Scott, we also question the responsibilities of the wealthy in addressing societal challenges. Prepare for an insightful exploration of how inheritance isn't just a family affair but a societal dialogue shaping our world.

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Speaker 1:

Welcome to the Think Generation of Wealth podcast, and this is episode number 117. I am your host, amir Estimo. Thank you for tuning in in today's podcast episode, because you could be doing anything in this world, but the fact that you are listening to this podcast episode is much appreciated. That you are listening to this podcast episode is much appreciated. First off, this podcast episode is brought to you by Starville Talent Group. Starville Talent Group is a company that specializes in promoting financial literacy to get people out of debt, save money for generational wealth Also. Thank you very much again, like I said, for tuning in to today's podcast episode.

Speaker 1:

So today's podcast episode is a continuation of the previous podcast of 116, where I dived in into talking about Jackie Chan not leaving his wealth for his children, his son and estranged daughter and I thought that was an interesting conversation. And if you're someone who's married whether you're married or engaged, or girlfriend, boyfriend, whatever if you're not married yet this is actually a good thing, because you and your soon-to-be spouse can have this discussion to make sure you guys are on the same page when it comes to whether or not you guys would like to leave your wealth for your children as you guys pass away. So I thought it was interesting because me and my wife had this discussion. I brought this topic to her and she said no, you know what I'm not leaving? I'm not leaving my wealth for my children. Jackie Chan thinks that if he leaves his wealth, they're just going to spend his, and if they're capable, they can do this, they can go make their own money, which is what my wife thinks too, and I find that very interesting, very, very interesting. So now let's let's dive in.

Speaker 1:

So we're going to a lot of these numbers. I made some of these numbers I'm going to throw at you. They're going to be specifically tailored to US, so this is not worldwide numbers, okay. So, first of all, 26% of Americans plan to leave an inheritance for the next generation, and the reasons they say is because ensuring financial security for their children, providing opportunities for education. So that means, if they want to go to college, home ownership, buy a home later or even start a business, okay. And then culture, or familiar expectations of legacy.

Speaker 1:

Now, I was actually shocked about this 74% of Americans do not plan to leave significant financial gifts to their heirs. So, as you can see so these are the four things they plan on doing. One spending on themselves, so focusing on enjoying retirement travel, covering health care expenses. Two donate to charities, so that means to redirect their wealth to philanthropic causes, leaving a broader societal impact. Three lifetime gifting support their children or others while still alive, allowing for guided use of funds. And four environmental or community contributions, so invest in projects that they love or foundations, creating lasting legacies beyond family. I thought point number four was interesting because how many times you may see someone passed away and maybe they left some funds you know, and then they start a school or something to that nature. So I thought that was interesting. And to see the number 74%, I thought that was interesting.

Speaker 1:

So we're going to discuss four things on today's episode why leave well, why not leave well? Psychological and societal impact and also cultural perspectives. Okay, so my question to you is, as we go through this, ask yourself do you believe like? Do you? What's your perspective on inheritance? Should parents focus on creating financial independence or leave a significant legacy for their kids? And I would like to hear where you can email me at contact, I think, genwealthcom, or you can even reach out to me on Facebook. Reach out to me on LinkedIn I'm on LinkedIn or you can even reach out to me on Instagram at Amir Estimo. So I'm interested to get different perspectives on this because this is an interesting conversation. Get different perspectives on this because this is an interesting conversation.

Speaker 1:

So now another another statistic that I have is this is from a law firm and you guys can check this out. This is edwardslawfirmcom, and edwardslawfirmcom stated that actually, so, we're gonna break this down. So that, actually so, we're going to break this down. So, number one 75% of Gen Z said that it's either their most important goal or very important to leave an inheritance. 81% of millennials cited leaving an inheritance as their most important or important goal. So I'm actually in this group. Important or important goal? So I'm actually in this group. 65% of Gen Xers agree with these, agree with both actually, and at 46% of baby boomers said the same.

Speaker 1:

So, as you can see, people do believe in leaving a legacy for their children. The issue is is whether your children are capable of continuing that. Are they educated? Are they educated again, financially educated? Are they mature enough to understand what the mission for the family and for the legacy is? Because a lot of kids just don't. And even if you do try, it still don't matter Like it really just comes down to a level of maturity on their end, and so let's dive in. So why should you leave wealth? Well, number one, emotion security.

Speaker 1:

So this, this right here is, is a uh important one, because even in our society we are born, once we die, we actually don't really leave wealth. We leave debt for our children. Okay, so it could be in the form of credit card, whatever. So now the kid, the children or kid, is off to the wrong start in life, because now, let's say, depending on what age they pass away, your parents pass away, and then now you're observing all this debt and actually I can say I came across this sometime last year. I've actually bought a property from someone, and when I bought it from them, the reason they needed the money was because their father, who was sick at the time, had so much debt and they were now basically in charge of getting the debt paid because otherwise it would fall on them. I don't know all the intricacies, how that happened, but I just know that was what I was told that, hey, I need to sell this property because, number one, we have no money and then, number two, my dad he's. If he, once he passes away, we're not going to, we're not going to have anything, and it's going to be a struggle for us because now we're accounted for his debt too.

Speaker 1:

Number two is family values. Do your family understand Because I'm a first generation who went to college and not many after that has done that? My parents didn't go to college, they were immigrants. They came here. The only thing they knew to do is come to work and then provide, send money back home and hopefully start bringing our family here. Number three and we're getting legacy is is maintaining family wealth, and then this should be passed down from not just the first, second, third and so on.

Speaker 1:

Now there's a flip side to this. Why should not leave wealth? Well, number one parents believe that if they leave their wealth, all their hard earned work will be diminished, because is their children mature, mentally mature enough to be able to understand the mission? I can honestly say this. It was interesting because when me and I talked about this, it had me thinking about my 18 year old. I don't know what she's going to do later on in life, but I know right now if I was to pass away. I'm not leaving her nothing, but I know right now if I was to pass away. I'm not leaving her nothing. I'm just being 1000% honest. I'm not leaving her nothing. I think it's her, it's going to be her response Now. If later on, if she is more mature mentally and understand the mission, then I could say OK, you know what, I can leave you something, but I'm not leaving you everything. Ok, there's going to be. You have to be able to put in some type of work, because I'm not going to do that for you. Then you take my money or take my whatever assets we have, and then you spend it like crazy. And then, even right now, she still has that mentality where it's it's, it's not, she doesn't understand. My 18 year old just doesn't understand. So therefore, even right now, if we were to discuss no, I'm not leaving her down right now, I'm just saying I don't know about the future, but right now, zero.

Speaker 1:

Number two wealth equality. Now, that's interesting because we talk about, when we talk about, unfortunately, in this country we always everything, sometimes circumvents backs to race. So, as you can see, our counterparts, our white counterparts, have a head up against black, uh, even against hispanics, even have a head up against black people. Black people, they say the money does only circulates around the black community only one time, and I and I don't think even last in this three hours max, from what I, from what I read a while back ago. So now we're already behind. So our white counterparts and other races are ahead, leaving um, you're trying to create this equality, so it's not necessarily where you if I leave you. Well, well, you're trying to create this equality, so it's not necessarily where you if I leave you. Well, well, you're going to have a leg up against someone who's black or Hispanic, or Asian or Indian or whatever. But if you don't have it now, you're on the same Tatum pole, right, you're on the same leverage, same level as them. So that's another reason.

Speaker 1:

Financial priorities, again, my 18 year old does this is a perfect, because she doesn't even understand Um, like we've been having to have discussions about this ad nauseum, because I'll be telling her like hey, you know you make some money, you need to put some money away. In her mind, she's like, well, if I make this money and I save it, why can't I spend it? And it's like a constant, constant, constant reminder, reminder, reminder. And when you're trying to teach them how to age like this and I can, let me be real with you, from the time, the times I grew up to her, I, honestly, even my wife if I was to take it from a female female my wife, even though she had her at a young age my wife is at her age was much more mature mentally than her, and it's not even close. Let's just be real, I'm just being 1000%, it's not even close. Financial priorities Do they understand? Hey, if I do? They understand a life insurance? Do they understand short-term? Do they understand long-term? And the answer is no. At this age they're not. They're not mentally mature. Now, not all of them is like this, but for the most part, most of them are OK.

Speaker 1:

Now we talk about the psychological, societal impacts. Now, how does it inherit to shape the family dynamics and relationships? That's interesting, because how many times you hear well, dad passed away and he left the house for the oldest son, or something passed away and he left the house for the oldest son, or something. The youngest son gets the car, or the middle one gets a, gets a, a watch, that's worth something. But then all sudden the relationship gets strained because, hey, I wanted that house, not no, no, I wanted that car. Oh, oh, no, no, like it's not fair and that causes a rift. Sometimes it even leads to a crime against each other because of, maybe, the level of envy and jealousy that was displayed amongst siblings.

Speaker 1:

Okay, two, the psychological effects of receiving or not receiving. So, for example, tori Spelling I talked about this the last podcast she hated her father because her father did not leave her nothing. But you know, at that moment she's not thinking why her father didn't leave her anything. Her father didn't leave her nothing because she was a druggie, she was pissing away money and she was never really saving. And when I first read that a long time ago I thought that was interesting. And now I'm a parent, I see why it's done.

Speaker 1:

Because kids, just you know, you have a child, first of all irresponsible financially. Second of all, doesn't even understand. Hey, the reason why my dad left me money or left me inheritance, or left me wealth is for me to start something that I can leave passed down to the next generation. But if you don't understand the mission, don't understand what's going on, guess what happens Then? Now it gets lost and then boom, generational curse begins.

Speaker 1:

Okay, now the cultural perspectives, as we can see. So cultural perspective is compare how inheritance practices varies across different cultures and regions, and we know let's be real blacks don't most, for the most part not all, but for the most part are not financially literate. Compared to maybe whites, compared to maybe Asians, compared to maybe East Indians or Arabic culture, even Jewish, they're not as financially educated or financially literate. So now what happens is you're going to get a statistic, hey, you make the money. Three hours later it's gone. It's because there's not a level of discipline, there's not a level of not just discipline, but there's not a level of understanding and there's not a level of maturity. So because I it's crazy, because kids in the U? S have it so much better to a certain degree and this is why I say this, why I say this is in China.

Speaker 1:

I seen something online in China, kids probably. These kids are probably maybe, let's say, the age range of five to maybe ten, something like that, and they were already learning. They were already learning how to cook, they were already learning life survival skills, and in the US, these kids, five, ten years old, they're already on social media or parents probably, who was born young and had no level of discipline, no level of maturity, are basically friends versus hey being a parent. So these kids, we are now as you in China, these kids are more advanced than us. And then versus the U? S, because we're focusing on the wrong things. So when you look at it, these kids Chinese kids I had friends who were.

Speaker 1:

I had a friend who was Asian and I had another one who was Indian. That I was, I was not best, for we were really cool. We went to high school, college and then, you know, as you get old, of course you know we dispersed. But one thing I tell you they were going to school not just five days a week, but they were going to school Saturdays. They were doing some type of whether it's help, whether it's something that you're struggling with. The parents would be able to get them some type of help, but here in our culture, especially in the US, it doesn't happen. Kids' mentality when I go to school five days, I'm done, I'm not learning, but the education is still continuing.

Speaker 1:

Now the pressure is different because you know, if you're someone who may be an African descendant, came from Africa, or someone came from Asian continent, or someone came from me, man, you are drilled into hey, you're going to be an engineer, you're going to be a doctor, you're going to be, uh, something, and it's drilled into you, you are conditioned to think that. And if you don't, it's not as you fall, man, it's like you're chastised, you're you're, you're out of the family, or it's all of that above and then, what's the growing trend of giving while living, a high profile example. So, um, I I'm not really a big fan of this guy, but Bill Gates, you know, um, not from in the past. Actually, you know what that's better. Yet, uh, jeff Bezos, ex-wife, I think. I saw something where she gave $38 billion last year and she was happy. She was happy. And could you, you imagine what? What do you say? Well, she has kids. Why don't you leave that money for the kids?

Speaker 1:

You know, to me is it's one thing to obtain assets. Now I've seen again, uh, elon musk. I've seen a headline he's now the world's richest man, valued at $400 billion. To me, that's not really impressive. That's not I don't. I just like.

Speaker 1:

If someone was to come in and say, yeah, I'm worth a billion dollars, I'd be like I don't care, because, first of all, it's your wealth, it's not my wealth. That's number one. And then number two, what are you doing to help humanity? If you obtain all that wealth, why do we have people sleeping under bridges, like right now? I'm in Dallas, texas, and it was it's been snowing the last two days. I can only imagine because me and my wife was driving by the other day as we were getting our stuff ready because the snow, we saw a couple gathering their things on the side of the street and in my mind, thinking, man, what, like these people? I have a roof in the AC that I go home to and they don't have that. But to me that's like that's a motivation for me to.

Speaker 1:

If I was to obtain that type of wealth, I would. I would hey, let's look at starting programs for these homelessness, let's get rid of homelessness. What programs we can do? Rehab centers, because most, some of these people are on drugs, you know, and they don't have nowhere. They're lost and they don't have nowhere. But in here you have a guy who's worth for again, I'm not no shade, no knock on even thing is is how are you helping advancing? Because when you obtain all that wealth, you can't go anywhere with it. When you die, it just stays here. Why not leave that wealth to figure to to someone who actually needs it. So I I thought this was, uh, really, really interesting. This was a.

Speaker 1:

Again, my question to you is what is your perspective? Should you or should you not leave inheritance for your children, if you have any? Or how about the ones who was pondering about having kids? Do you think if you don't have any kids yet, that's actually a good thing? But what is your perspective? Do you believe that you should leave your wealth for your children or do you believe not? So that's a question.

Speaker 1:

I think, if anything you got this podcast today is to understand that it's up to you. I think this is an up to you thing because for me, like I said, I can go talk to my 18 year old and she just don't understand right now and therefore, if something were to happen, I can't entrust that she's going to be like you know what I get? What my dad was saying when, even as I'm living, can you? So I can understand the people who says you know what? I'm not leaving my wealth for my children.

Speaker 1:

I can understand that because if you're living, I tell myself that I say you know what, if I pass away before that happens, whatever money I have let's say it's $2 million, I can leave $100,000 for my kids, $50,000 for my two kids, here's $50,000 for you, here's $50,000 for you. And here's the reason why I say I would not, because for me, I would want to enjoy what I worked hard for and it's their responsibility to go. I can give you a head start, but I can plant the seed, but you're the one who's going to have to grow. You're the one who has to water it, take care of it, feed it the right nutrients so it can grow into something, whether it's a victory or plant whatever that is. But if I'm the one who's planting the seed and taking care of it, you're not going to understand the patience it takes for that, and I think a lot of children these days are in that mindset.

Speaker 1:

So for me, hey, you can get a head start, but it's going to be your responsibility to build your own wealth, to do something for yourself. Because if I left you 50K, the 50K would be with stipulations, trust me, and then you turn around and pissed all that money away. I'm not leaving just you money. I'm going to think about if you have grandkids and whatnot, and if these grandkids, because if you're pissing money away and what's, what's the? I may be contradicting myself here a little bit, but what is the? What is it that? Because now I have to count on you to teach your children, your grandchildren, but if you're not financially responsible and literate, it's just going to continue and I can't have that. So I would leave that money for a good cause, enjoy the money while I'm living and if I get sick I have something that can take care of me. I'd rather put all my faith in you. So this is an interesting topic.

Speaker 1:

I'd like to hear from you again. You can reach out to me on LinkedIn, amir Estimo. You can reach out to me on Facebook, amir Estimo. You can send me a message. I'd like to hear more. Even send me an email. Contact at thinggenwealthcom. I appreciate you tuning in to today's podcast episode. Until next week, much love Peace.