Values & Valuables (Part 3 of 3)
The idea may shock you, but many lives are destroyed by the impact of sudden wealth through inheritance. As leaders of churches, ministries, and nonprofits, it’s up to us to start the conversation.
Nonprofit and ministry executives cannot assume that legal or financial advisors are helping their clients (your donors) to understand how they can pass on their values along with their valuables.
For decades, large financial institutions and attorneys have assisted individuals in making a will, estate plan, etc. And the goal has largely been the same: create the fastest, smoothest transition of assets from one generation to another.By 2038, over $41 trillion will change hands through inheritance. Is your organization prepared for this shift? Click To Tweet
Unfortunately, the large majority of people who will inherit these assets will receive their parents’ or grandparents’ valuables while missing out on the values of the loved ones who’ve passed on… much to their detriment.
A Tale of Caution
Early in our marriage, we had a neighbor who was an only child whose parents passed within a few months of each other. Prior to the passing, it was a loving relationship and the couple seemed close.
After the passing, the young man inherited the parents’ house and an undisclosed sum of money. We never knew how much they inherited, but it was likely $100,000 or more in cash, plus the home. They felt set for life.
Sadly, the inheritance virtually destroyed that young couple’s marriage.
They immediately changed their lifestyle: bought a Corvette, an SUV, and moved into the parents’ house. Soon after moving in, they started remodeling the house.
The remodel destroyed any remnants of mom and dad, past memories, or even values the son had grown up with. At the same time, this loving family was soon demolished.
They were at each other’s throats — so much so that at one point, my wife had to call the police for fear of the woman’s safety.
This horrible situation is a great example of passing valuables but not values to your children.
A Life and Death Situation
There is very real danger in passing on your valuables without passing your values — and no one wants to talk about it. But it can destroy the ones to whom you leave your wealth.
In fact, it doesn’t even take millions of dollars to be detrimental to your heirs.
A few months ago, I spoke with a donor who told me, “The last time I saw my son, he was living under a bridge in Fort Worth, Texas.” This father knew that if he left even a small inheritance of $5,000 or $10,000, it could easily end his 20-year-old son’s life through a meth overdose.
That father knew that passing his valuables on to his son could have killed the young man.
Despite very real, life-or-death situations like these, the financial services community continues to focus on valuables, not on the person’s values.
I spoke with a Texas estate planning attorney a few years ago. I asked why he didn’t include charitable giving as a possibility to his clients. He responded that he felt it was outside his ethical parameters to introduce the subject.
How can that be off limits when you are clearly working with a family that has charitable giving, philanthropy, or spirituality as part of their core values?
It wasn’t that the attorney wasn’t qualified. He could draft some of the most complex charitable trusts for foundations and charities.
Far too often, it is the training, the habits, or the ethics of financial advisors or attorneys that limit these conversations.
It’s Up to YouFocusing solely on passing your valuables is efficient. But is it truly beneficial to your family or your legacy? Click To Tweet
The best thing for your family — and those of your donors — is to ensure your estate plan creates the financial environment where your values are fostered or empowered in your heirs.
As your assets transfer, whether during life or at death, your planning should cover your family values and how the exchange of valuables will occur.
But this is not typically going to happen through traditional legal or financial counsel.
An untapped pathway to reverse this trend and help families leave a lasting, helpful legacy to their children as ministry, church, and nonprofit leaders is to start the conversation. We must show them how they can pass on their values as well as their valuables!
You and I must bridge that gap to bring values back into the estate planning conversation.
The average American would much prefer to “disinherit the government,” reallocate those funds to support their values and leave a lasting legacy that supports the family instead of tearing the family apart.
Getting the conversation started
As nonprofit and ministry leaders, we are in a unique position to help our constituents avoid the very real danger of passing on valuables without values. But for many leaders, this isn’t always easy.
That’s where we can help. We’d be happy to put our 50 years of combined experience in planned and asset-based giving to use in helping you achieve your organizational development goals.
To see if we’re the right fit for you, let’s talk.