The Family Legacy

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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

Generational Wealth Creation
The Vanishing Legacy
With the final breath, it all ended. All the lifelong
dreams, the fifty years of work, raising a family, the painof losses, the memory of joys and happiness gone. Now
all that is left of that life are the memories of that person
and the legacy of a lifetime. To those left behind, thememories are theirs to keep, but everything else must bedivided into two categories: What they are allowed tokeep, and what the government claims to be theirs.
What is truly unfortunate is that the government claims
must be settled first, and what is left is divided between
creditors of the deceased and members of the family.
A hundred years ago it was not uncommon for farms
to be worked and owned by a family. The grandparents
were there working and contributing to the farm, alongwith their middle-aged children and their grandchildren.
The family structure was whole. Family pride wasevident and this was passed on generationally. The older
members of the family were well aware of the idea oflegacy. They worked hard to create a better life for thenext generation. The farm, along with the memories,
was their legacy.
Today that element of a family legacy has almost
disappeared. Although there are loving memories, thepassing of the family “farm” today known as family
wealth, has been mismanaged into non-existence.
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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

Interference from the government, an enormous lack offinancial knowledge, pride and ignorance robs families
from passing tremendous amounts of wealth to the next
generation. Along with it goes the lasting family legacy.
When no one pays attention to the everyday detailsof the farm, it will no longer be a productive entity topass on, and in many cases, it will become a burden and a
debt to the next generation of the family. Today the ideaof viewing the family as a single unit has been ignored byalmost everyone, yet it remains as one of the only
solutions for creating lasting family wealth,generationally. The passing of the family wealth (thefarm) doesn’t occur accidentally. It is planned and wellthought-out. Rich people do this often and their families
remain rich. Poorer families, although their lives may
prosper, believe in taking it with them when they die.
Their legacy is usually a home, some savings, and other(for lack of a better word) stuff. Although those thingshave value, they lack in comparison to what could havebeen passed on had the entire family planned the family
legacy seriously.
The idea of keeping wealth in the family is opposed
vigorously by the government because they have aharder time getting their hands on this money via taxes.
Many politicians try to pit the rich against the middle
class, all the while the middle class aspires to be richpursuing their financial dreams via the lotto and casinos.
The difference comes down to this: Some families
guarantee their ongoing legacy while others gamble itaway.
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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

The Social Fiber Of The Country
The United States started to lose an important social
foundation in the 1960's. Crisis after crisis, fromVietnam to civil rights, the drug culture to presidential
assassinations, the once starry-eyed nation woke up witha reality hangover that would plague it forever. Whatwould suffer the most in this historic time would be thefamily structure. The “What’s in it for me” and the “Iwant it now” generation blossomed and grew up to train
and educate the next generation, flaunting the wisdom of
ME and I.
The family social structure, once the cornerstone ofethics and morality, started to crumble and with it family
opportunities also crumbled. The growth of single
parent families left little room for financial success.
Government social engineering only created more
problems and greater dependence for its so-called “free”
benefits. That dependency aided the problem not thesolution. The after-effects of the loss of the family
structure continue to cost the government billions ofdollars. Along with the costs, are increasing crime rates,
suicide rates, divorce rates, abortion rates, personal debt
and bankruptcy rates. All of these have a direct
correlation to the loss of the family structure.

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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

INSTITUTIONALIZINGEDUCATIONAL STANDARDSWith the fall of the family structure, the liberalizingof education took on the role of psychologist in making
kids feel okay and being sensitive to their every need.
The new educational goal is that no one would fail inschool. They would only fail after they were out ofschool. The ability to apply school knowledge toeveryday circumstances is non-existent. Not only is theknowledge missing to grow wealth, but also missing is
the family and its ability to grow wealth generationally.
In the old days, this would be the equivalent to thegrandparents leaving the farm before they taught theirkids the farming process. Obviously, nothing wouldgrow, which is why in today’s family, nothing is growing
either. More time and energy is spent on teaching you
how to spend your money, rather than how to save it.
You end up unknowingly and unnecessarily giving away
your wealth and wealth opportunities.
If tomorrow you discovered an opportunity that, byplanning together with your parents or your kids, could
create millions of dollars for your family (or charities),
would you take advantage of that opportunity? If you
also discovered that the money could be transferred toyour family, guaranteed and income tax free, would you
do it? I have reason to believe that you were not taught
how to do this in school, any school.
5Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

Creating The Legacy
It came to my attention while visiting the San Diego
Zoo that every animal display had something in common.
Each one of them was funded or sponsored by a family orfamily foundation, a/k/a generational family wealth.
The question that came to my mind was: What did thesefamilies do, that others didn’t or don’t do? The
revelation hit me like a ton of bricks: They leverage theleast amount of money to create the most amount ofwealth by investing in their family.
RULE NUMBER ONE: In your family, use the least
amount of money to create the greatest amount ofwealth.
RULE NUMBER TWO: Guarantee the wealth will
occur and that the legacy will transfer, income tax-free.
That was the answer. It was clear, and believe me, it
was the best trip to the zoo I ever experienced. On theway home though, one thought kept echoing through myhead: Rich people think like rich people, poor people
think like poor people. It was troubling. I asked myself
one question: Would someone want to create wealth fortheir family if they didn’t have to spend one more dime
than they were spending right now? If you could realignyour assets to make wealth possible and still retain
control of the money would you do it? The key to all of
this is to consider the family as an investment.
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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

Controlling The Asset
Investing is not about where your money is, it’s
about how can you use it to create wealth. This is far
different than buying a stock and praying that the stock
will go up. Warren Buffett never buys 100 shares andjust holds it. He, like Mark Cuban, buys shares of a stockto get some level of CONTROL of the company. If you
have the resources to take control of a company, and you
think it’s a great investment, do it. If you want to try toguess on some companies, buy their stock and hope itgoes up, you might as well go to Las Vegas, because you
have no advantage at all to CONTROL the value of thatstock.
In the old days, the family had total CONTROL ofthe farm. The family could affect the growth andoutcome of the farm they owned and CONTROLLED.
Today, in generating family wealth, dabbling in stocks
doesn’t provide the ownership and control that is needed
to pass on wealth successfully. The elements that affectthese types of legacies are taxes, risk, creditors, and luck.
In defense of many who follow this strategy, professional
advice has told them this is the only way to create
wealth.

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Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents GuideLeverageUnfortunately, following traditional investment
plans does not create multiples of wealth immediately. Ifa family asset is not being used to generate income thenthat asset should be used to create family generational
wealth. You would want to insure and guarantee thatthe wealth be transferred to the family income tax-free.
Most importantly you would want to expend the least
amount of money to create the most wealth. This is
known as leverage.

The Contract
If you were able to invest in the oldest member ofthe family and they allowed you to do so to create theultimate family legacy, what investment would be used?
Life insurance. It is the perfect solution for family
wealth creation. It is a contract the family CONTROLS.
The cash values and death benefit grow tax-deferred andincome tax-free. It is protected from creditors andpasses outside of probate. Any number of family
members including the parents can contribute to thepremiums. This creates the greatest amount of death
benefit that will pass on to the family. All of this iscentered on the legacy of love. This will be a very
emotional decision and should be viewed with the properperspective. In the old days, all members of the family
would invest all their time and money to increase the8

Wealth & Wisdom InstituteEliminating Losing Financial Strategies
The Family Legacy – A Grandparents Guide

wealth of the farm, knowing someday it would be theirs.
They didn’t do this out of greed, but out of love for thefamily.

Leonard Renier
President, Wealth & Wisdom©2006 Wealth & Wisdom, Inc. All Rights Reserved. (revised 2012)9