How to Create Generational Wealth

We often think of generational wealth as something passed down after death. But what if the wealth was given away “with a warm hand”? More on this in our full chat with Adam Bornn ( @ParallelWealth ) on The Wealthy Barber Podcast.

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Generational wealth is not passing money from a 90-year-old to a 65-year-old. It’s passing money from a 65-year-old to a 35 or 40-year-old. And so that’s a lot of the conversation we’re having with our clients is once we build out a plan, said, look, you have all the money you, you plan to spend and more. And that more you can either give it to your kids when you pass away or we can actually build into your plan how to gift that off to show you how much and when and how to do it tax efficiently. So that’s a massive part of the planning that we’re doing and, and I know other, uh, advisors across the country are doing is how do we get this money to the next generation now without sacrificing your retirement?

Yeah, that’s really well said. And interestingly, to that point, I’m seeing a lot of people say 80 plus, who are gifting the money directly to grandkids and not to their kids because their kids are late fifties. They’re already settled. They bought the home, they’re heading toward their own retirements. They’re trying to help out two generations below to get that first home, which is, you know, is so, so difficult.

Yeah, and I always tell people, like sometimes clients will say, you know, we’re getting an inheritance. We don’t know how much can we just leave it out? And I say, I prefer to leave it out because I’d prefer you actually pass that straight through to your kids.

Right. Right. And, and so getting that mentality, like if you want to create generational wealth, pass money to 20 and 30 year olds, not to 50, 60 year olds.