The Right Kind Of Legacy To Leave

The Great Wealth Transfer is upon us. In the next few decades, Baby Boomers, the generation born between 1944 and 1964, are expected to transfer $30 trillion in wealth to younger generations. ( If recent events and the habits of lottery winners are any indication, most of that money could simply go to waste.
The pandemic showed us what happens when Americans receive free money. They go on spending sprees, and they refuse to work. During the height of COVID, many Americans simply chose to collect unemployment and stimulus checks rather than work, resulting in a severe labor shortage. And according to a recent study by, 60% of unemployed Americans are not looking for work.
To gain a little insight into what Americans do when they suddenly fall into an insane amount of money, look no further than what happens to lottery winners. According to the National Endowment for Financial Education, 70% of lottery winners go bankrupt within a few years. (
Is your wealth going to be in good hands? ​​What kind of legacy will you be leaving? ​​If it’s simply a legacy of money, that money may not last long.

​​The once-vast Vanderbilt fortune is a cautionary tale. At the time of his death in 1877, Cornelius Vanderbilt was worth $202 billion in today’s dollars. By the time of a family reunion in the 1970s, there was not a millionaire left among all his descendants. The Vanderbilts were once the wealthiest family in the United States, but over time, Vanderbilt’s descendants squandered the fortune on wasteful spending and partying.
In contrast to Vanderbilt, fellow tycoon John D. Rockefeller, who died in 1937, left a more lasting legacy, with his heirs still maintaining a fortune worth around $10 billion, much of it in the form of real estate.
What kind of legacy do you want to leave? If it’s a lasting legacy you want to leave, model the Rockefellers and not the Vanderbilts. Otherwise, your heirs will end up like most lottery winners:  Broke.
Leaving a lasting legacy begins with education. Before a transfer of wealth, there should first be a transfer of knowledge. Instilling in your heirs the importance of investing in order to grow and preserve wealth is vital to ensuring your wealth lasts. And it’s not just any type of investing that will do.
According to Oxford, to invest means to:

​“expend money with the expectation of achieving a profit or material result by putting it into financial plans, shares, or property, or by using it to develop a commercial venture.”

What most people’s idea of investing is isn’t really investing but speculating. They don’t have an expectation of profit; they have hope for one. People think that when they invest in the stock market, what they’re doing is investing, when, in fact, what they’re really doing is gambling. They don’t know if a stock will go up or down. They hope it will.
Investing is not speculating. Investing is what the Rockefellers did with their fortune. It’s putting their money into something tangible with an expectation of return. With real estate, it’s not a matter of if you’ll get your return, but a matter of when. Cash-flowing real estate has proven its worth over time, to the point of being almost as certain as death and taxes.
Leaving generational wealth that will last starts with teaching current generations financial literacy. Don’t speculate on whether they’ll have the tools to maintain and grow your wealth. You have to teach them in word and deed and teach them to invest the right way. Teach them not to speculate on the latest shiny thing and to invest in tried-and-true cash-flowing tangible assets.
The ultra-wealthy and smart individuals understand that the key to wealth is to have your money work for you. Because passive income investments are not tied to a time clock or a job, these assets have the ability to build and preserve wealth like no other assets. It’s why the ultra-wealthy consistently allocate more than half their portfolios to assets like commercial real estate and income-producing businesses (i.e., private equity) than any other assets, including stocks.
There’s another reason the ultra-wealthy are attracted to real estate and private equity. They’re illiquid. They cannot be sold quickly, like stocks. This illiquidity protects investors from themselves because they can’t be unloaded quickly in a state of panic. These are long-term investments that reward their investors over time. Illiquidity forces patience.
About $30 trillion is about to change hands. Much of it will go to waste. Leave your wealth in the right hands. Leave the right kind of legacy. Leave a legacy of knowledge and discipline and of the value of investing in the right assets.