Welcome to Radical Personal Finance, a show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now, while building a plan for financial freedom in 10 years or less. My name is Josh Ruchites. I am your host. And today we're going to talk about how you can die broke like billionaire, or shall we say former billionaire, Chuck Feeney did.

There was a Forbes article published on September 15, 2020 with the headline exclusive, "The billionaire who wanted to die broke is now officially broke." Let me share with you the lead of the story. It took decades, but Chuck Feeney, the former billionaire co-founder of retail giant Duty Free Shoppers, has finally given all his money away to charity.

He has nothing left now, and he couldn't be happier. Charles Chuck Feeney, 89, who co-founded airport retailer Duty Free Shoppers with Robert Miller in 1960, amassed billions while living a life of monk-like frugality. As a philanthropist, he pioneered the idea of giving while living, spending most of your fortune on big, hands-on charity bets instead of building a foundation upon death.

Since you can't take it with you, why not give it all away, have control of where it goes and see the results with your own eyes? We learned a lot. We would do some things differently, but I'm very satisfied. I feel very good about completing this on my watch, Feeney tells Forbes.

My thanks to all who joined us on this journey, and to those wondering about giving while living, try it. You'll like it. Over the last four decades, Feeney has donated more than $8 billion to charities, universities, and foundations worldwide through his foundation, the Atlantic Philanthropies. When I first met him in 2012, he estimated he had set aside about $2 million for his and his wife's retirement.

In other words, he's given away 375,000% more money than his current net worth, and he gave it away anonymously. And the article goes on, you can find that article at Forbes.com. I enjoyed reading this article because there are some things that I think are true or that are right that need to be discussed and often aren't discussed as much as they should be in financial circles, especially in the circles of estate planning and what do you do with your money when you are dead and gone.

And so I want to share with you some ideas for you to think about because it is a responsibility that we all have. If we think about that final stage of finances, financial abundance in my seven stages of financial freedom, if you think about that, what do you do when you have more than enough?

You're going to have to figure out what to do with the excess. Now I'm intentionally using words and language around money that can be adjusted based upon your unique circumstances. For some people, more than enough might be a very big number. For other people, more than enough might be a rather modest number.

You're the one who has to decide what is enough in your personal circumstances. But if you live and behave in a frugal way, if you live in a responsible way, you earn more than you spend, you save, etc. Chances are you're going to have more money than you can spend.

And I think that within the audience of radical personal finance, this is going to be more common than not because most of us who are building wealth, we're not exclusively building wealth with the simple goal of making just enough for us to live on and then quit. Most people don't have that as their cornerstone of their financial plan.

Now if you did want to, you could do that. And today's show, we're going to have three parts in it. Number one is just simply a quick conversation on Chuck Feeney and what he did. Number two, we're going to talk about conceptually what you should do. Perhaps you're not yet a billionaire.

These concepts still apply to you. And then in the third part, we're going to talk about the nuts and bolts of financial considerations. And really how can you do this with some of the financial tools that are available to you depending on what your personal goals are. But I want to point out that if your personal goal were simply to accumulate enough money that you could live on for the rest of your life and to die completely broke, you could do it.

Probably your simplest way to do it would be to earn money and then to buy some annuity contracts from insurance companies and those contracts would give you a guaranteed payout for your entire lifetime. They would go until the date of your death. And when you die, your money streams will die as well.

That would be the most efficient way to guarantee that you spend as much as you possibly can during your lifetime and that you die broke. This is far more efficient even than the common idea of building a portfolio of stocks and then withdrawing from that at 3 or 4 percent, be much more efficient to use annuities in this context.

We'll talk about that towards the end of the show. But you could do this as well and you could just set the goal that I'm going to earn just enough money to cover my needs and I'm going to spend it all. But most of us are not just working to earn money to provide for ourselves.

Most of us are working to earn money to provide for others that we care about. We're also working because it's a lifestyle that we've chosen. I personally think that our work is one of the best ways that we make a contribution to the world. That work may or may not be remunerated financially, but we will continue to engage in work because it's one way of contributing to the world.

It's a way of making the impact. And I think most of us have a desire to make an impact that will outlive us. And so there are different ways that we do that. It might be as simple and commonplace as seeking to impact our children and our children's children and descendants down the road.

That's probably not going to result in financial gain, but it certainly will impact the world. It might be simply trying to help our neighbor or as is a good example with Chuck Feeney, it might be seeking to help people all around the world and invest billions of dollars into high impact activities.

You get to choose how you do it, but there's a good chance that your work will involve money in some way or other, some way of making money. So let's talk about some of the lessons that we learned here with Chuck Feeney's story. I think the first big lesson is to recognize that you can't take it with you.

That's what Chuck clearly says in this story. You can't take it with you. There's an old quip that I used to hear motivational speakers talk about and they would go something like this, "How much money will Bill Gates leave behind when he dies?" Same as you and me, right?

Exactly the same, which is all of it. When we are dead, all of the money is no longer ours. None of it goes on ahead. I don't think that really most of any of us have much aspirations to do some of the things that past generations of human beings have tried to do to affect the afterlife with money.

Now there are some cultures, particularly Eastern cultures, that have a cyclical view of life where they feel that life is always coming and going. That's of course very common in Eastern religions. Most of us in the West, we have a direct view of time. Time began at one point and it moves forward.

And once we're dead, we're dead. We're dead and gone. Now perhaps some people might want to build a large mausoleum, but I've never met anybody who shares a belief that perhaps the Egyptians shared that they should build a pyramid to entomb us or fill our tombs with fruits and vegetables and seeds and jewels and things to take into the afterlife.

About the best you'll see at this point in time is you might see somebody have a big fancy headstone in the cemetery and maybe a statue gets put up somewhere of you. But at the end of the day, once you're dead, all of the money stays behind. No money goes from this life into your next life.

And so in that context, it's valuable and important to realize that because if you realize that it puts a lot of things into focus. It puts a lot of things into priority. As I want to say, money is the ultimate renewable resource. There's an unlimited amount of it available.

There's an unlimited amount of it available to you. And so it's always renewable. Whereas time is the ultimate non-renewable resource. It's finite. It's specific. It had a beginning and it will have an end. And you had a beginning and you had an end. And so you're balancing these aspects of time versus money.

It's an important pressure that you're going to face throughout your lifetime. And so it's good to begin with the end in mind, especially with money. It's good to recognize that at the end of my life, when I die, all of the money stays here. So how am I going to use it most effectively for myself?

That's the first lesson I think we can draw from Chuck Feeney's example. Another important lesson is that different people will value different things. In other articles, Feeney is said to live in a modest San Francisco apartment. Evidently, the quip was that he had inkjet printed pictures in his office, which seems, I don't know, I think unnecessary, excessively, excessively, what word to use?

I don't want to say monk-like, but I don't have inkjet printed pictures in my house. I have proper pictures. And I think that that's certainly a reasonable thing. But when people share these anecdotes, they're trying to emphasize that this is not somebody who is obsessed with a certain way of living.

Now I would bet, I don't know anything other than about Chuck Feeney. I've never met him. I don't know any personal, I don't know anybody who knows him. The only thing I know about him is three or four articles that popped up in the news search after the Forbes article was written.

Prior to reading these articles, I knew nothing about him. I'd never heard of him. I just read these basic articles that are all rewritten versions of the same very few facts. However, I would bet that these displays of hyper frugality are probably exaggerated. The adjective that was used was monk-like to refer to his lifestyle.

In my observation and experience, I think these are very excessively exaggerated when people talk about how frugal wealthy people are. I believe there are genuinely some people who are very wealthy and who are intensely frugal. And of course, we all have the right to live how we like. But a lot of the stories that are told about people's frugality, really, they become, are they fake?

Are they made up? Not necessarily, but they don't take the whole picture. So I guess famously, you know, Warren Buffett's Cadillac that Warren Buffett drives to work. And famously, he had his Cadillac that was several years old and he could afford to drive a Bugatti, but he just chooses to drive a Cadillac.

And this is meant to be inspirational to you and me. And there's an element of truth to it. There's an element of truth to say that, "Hey, Warren Buffett drives a Cadillac. Why do you and I need to have a fancy car? A Cadillac, we can go get the same Cadillac that Warren Buffett drives." There is an element of truth.

There's an element of truth to the fact that Sam Walton drove an F-150, right? It's true. But on the other hand, there is an element where it ignores a whole bunch of stuff. Warren Buffett owns, I don't know how many, but a half a dozen properties all around the world.

Warren Buffett flies in a private airplane anywhere he goes. Warren Buffett's family lives very, very well and spends a lot of money. And so he might have this personal quirk of having driven for a number of years a gold-colored Cadillac, but that is not in any way indicative of the idea that somehow he lives on a $50,000 a year salary.

That's silly. And so the similar thing I would say with Mr. Feeney is that I would bet maybe he did set aside $2 million for his retirement. Maybe he does live in a modest San Francisco apartment. Maybe as a personal individual, he might enjoy living very modestly and frugally.

But most people who are billionaires could continue to live like a billionaire even if they had $2 million to their name simply due to their connections, due to their influence, and due to the circles that they run in. In the same way that if your brother has a nice boat and you have a good relationship with your brother and he lets you take the boat out anytime you want to take it out, then you can have that same kind of relationship among wealthy people.

So I would doubt that Mr. Feeney drives. If he flies somewhere, I doubt that he flies commercial, right? He'll hitch a ride with one of his buddies or he'll borrow somebody's plane. It's just not fair. Generally speaking, it's not fair to say, "Well, look, this guy was a multibillionaire and he just lives in this tiny apartment, so therefore you can and you should too." Billionaires live a very nice lifestyle.

Now once they reach a certain age, of course they change and they may not find so much joy in jet-setting around the world. They might find more joy in sitting and living a more tranquil life. But he doesn't live a penny-pinching life. But what I think is important, so with that caveat, which I think it's important to identify when we read these stories about hyper-wealthy people.

With that caveat, however, it is valuable to learn from his example that he doesn't seem to gain pleasure from the status consumption-oriented things that many other people do. He doesn't gain pleasure from developing and having a house full of supercars. He doesn't gain a garage full of supercars. He doesn't gain pleasure from saying, "Yes, I own 10 yachts all around the world." He doesn't gain pleasure from a lot of those things.

Evidently, he gains pleasure from living fairly simply. Now for me, this lesson is something that has always rung true for me, especially at different phases of life. But when I look at the lifestyles of the rich and famous, when I look at many of the large consumption items that people engage in, a lot of them seem to me to just simply add more trouble to your life than it's worth.

A number of years ago, I heard an anecdote. I don't know if it was apocryphal or not, or even where I heard it, but it was just the conversation about a rich guy who was having a house built in Florida. He was standing on the tarmac in New Jersey about to board his private airplane.

Arguing with the contractor who was building his multi-million dollar mansion in Florida about how it had to be just so, and this had to be done, and that had to be done, etc. And he thought, "Why am I doing this? I'd rather stay here and hang out on the weekend and not have to go deal with a new house." And what I took from that personally was just the basic idea that possessions can own you, your stuff can own you, and it can be really annoying to have all this fancy stuff.

I understand that some people enjoy it, and I think that you're right to spend your money how you enjoy, but I think that a lot of times some of the stuff that you buy because you think it's going to be awesome may actually not be awesome for you. And each person will have to think carefully about where that line is that they need to draw.

But having six mansions all around the house can be annoying, can be frustrating. And having 20 bedrooms in your house might not be as fulfilling as you want it to be. After all, you can only be in one bedroom at a time. And so when I think about being an older man and I think about living in a modest place that's in a place that I like, I don't mind at all living in a modest place.

And I would find it annoying. I would rather live in a small apartment that I liked with a great view and a place that I liked being. I would rather do that than have to deal with the care and upkeep of a 50-room mansion myself. Now, your mileage may vary.

You may decide differently, and that's your right. But I think it's useful to note that there are many, many people who become wealthy who don't give themselves over to excessive flashy consumption. And I think it's also valuable to note that that consumption can be often met, those consumption goals can often be met in a way, in a time that doesn't require them to control your life.

You can rent a beautiful place, right? You can rent a lovely yacht. And going and renting a big multi-million dollar yacht for a couple of weeks and chartering it for a few hundred thousand dollars is probably going to be simpler and just as fulfilling for you to do what you wanted to do rather than to have to deal with the hassle and the upkeep of that yacht all the time.

So recognize that there are many billionaires who don't engage in that flashy consumption lifestyle, high consumption lifestyle. And so you might or might not be interested in that consumption lifestyle. I think that Mr. Feeney's example with regard to giving the money away while he's alive is one of the most powerful things that we can do, especially if we want to make sure that the money goes to causes that you believe in.

It's dangerous for you to set up a giant foundation that's just going to be funded after your death and is dangerous for a number of reasons. Number one, you may have a certain ideology. You may have a certain thing that you want to contribute money to. You want to adjust.

You want to make a difference in the world. But it's probably going to be difficult for you to make sure that everybody who's controlling your money will do that for the long term. It's one of the things that's so difficult to do. Once you're dead and gone, you're dead and gone.

Now there may be some legal constraints that you can adjust. There may be some things that you can make happen when you are dead. You might be able to write certain things into your trust. But if you look at any kind of institution, institutions tend to stray at least modestly and often very, very significantly from the intent of their founder.

I think the best examples would be to look at the big old revered college institutions in the United States. Many of these historic universities, Yale, Harvard, many of the Ivy League universities, they were started, for example, and founded and funded by people with a very clear religious agenda, a very clear religious goal that they wanted to achieve, with a clear set of morals and ideas.

Well if those people were to come back and see what those schools stand for now, it's hard to imagine they would be happy with what those schools are doing with the money that they originally contributed to them. And if you look at many other more short-lived foundations, you'll see that.

Especially within a generation or two, if you look at a foundation, it's hard to see a foundation that doesn't stray from the intent of its founders. It's also hard to find a foundation that doesn't become bloated and somewhat bulky. A big pot of money that's just left there after your death is going to be a target for people who want to go and help themselves to some of it.

And when you're around most foundations, many foundations could be dramatically improved in terms of their efficiency, in terms of their productivity, etc. And they become wasteful. In addition, it's hard for a foundation to balance a dual-fold mandate of investing for a financial return and then giving. And this can be very difficult if you decide to establish a foundation that you want to last for generations, for centuries.

If you are going to leave $500 million behind to a foundation, and that foundation is trying to invest for growth but then give money away, the question is how much should they give? If they give away 10% of their assets per year, then this foundation is not going to continue for generations.

On the other hand, if they only give away 2%, well then it just becomes bigger and bigger and bigger. And are they accomplishing the mandate? And so in the same way that on a recent Friday Q&A where we were talking about the balance between giving and investing for yourself, and I gave a very wordy answer talking about how it's a really hard thing to decide, the same thing applies to foundations.

How do you balance this investing versus giving? And then what's more is how do you balance the ethics of a foundation and what they invest their money in? Perhaps you establish a foundation and you say, "Our goal is to make sure that we give money to this social cause over here." But then you're investing your money into companies that are actively working against that social cause.

This happens all the time and it's hard to do. In addition, the skills of giving away money and the skills of making money grow are only rarely found in the same person. You may be able to hire an investment expert who is able to successfully manage a portfolio, but that investment expert may have known nothing about successfully giving money away.

So can you create a team where you have an investment expert and you have somebody who's skilled at giving money away? You certainly can, but then there's going to be a built-in tension. And I think that if you approach something the way that Mr. Feeney did, where he had a goal of basically over four decades, 40 years, to give the money away, all of the money in 40 years, then now you can come back and your answers and your questions become simpler.

The solutions become simpler to these fundamental financial problems that you face. He evidently built his wealth by building businesses, but then he decided he was going to give it away. And so he didn't give any effort to saying, "Can I start another business and grow a bigger fortune?" He said, "I'm going to give it away." And so he gave a lot of money to big causes trying to make a big difference.

According to one article, his most notable donations include a $62 million grant to abolish the death penalty in the United States, a $76 million grant for grassroots campaigns supporting the passage of Obamacare, and nearly $1 billion in gifts to his alma mater, Cornell University, including the $350 million development project in 2012 to build a Cornell Tech campus on New York City's Roosevelt Island.

And so you see that he's trying to make big impact with big dollar contributions to causes that he cares about. And so as he's giving the money, since he's not trying to keep anything in reserve, he can make big contributions. I like this because it gives you the ability to possibly make a difference in a few areas.

And there's a lot to be said about his style of giving. I'm sure in the philanthropy magazines they're going to be analyzing his successes and his failures for quite a while. But I wanted to point out that it's good because it solves this problem of how do you balance giving versus investing.

You set a short timeline and you say, "I'm going to give this away as quickly as I can." And in his case, he was able to do it in 40 years. I think it's fascinating though to realize how hard he had to work in order to actually give the money away.

According to the news reports, at its height, the Atlantic Philanthropies, his foundation that he'd started, had 300 plus employees and 10 global offices across seven time zones. So he had to work hard to build a large foundation to actually successfully give the money away. One of the things that is very daunting to people when they accumulate significant wealth is they want to give the money away, but it's very hard for them to do so in any way that's going to actively generate a big impact.

And so it just seems easier sometimes to ignore it, to set up a foundation that's going to get the money when you're dead, and then to move on with your life. It's very, very challenging. There was a report written, the final report, Atlantic Philanthropies, I'll link it in today's show notes as well that I think you'll enjoy, but they did list out the top 10 grantees, which were Cornell University, $965 million, University of California, San Francisco, $636 million, University of Limerick, $181 million, Trinity College, Dublin, $168 million, Stanford University, $145 million, the Rhodes Trust, $134 million, Queens University of Belfast, $132 million, Dublin City University, London School of Economics, and the Cork University.

So the top 10 grantees are all educational institutions. And so I think that's interesting because what you often see is you often see that wealthy people choose to patronize educational institutions. And I scratch my head at this a lot, for me personally, just from an ideological perspective. I often scratch my head.

And the reason I wanted to point this out though is that this does make the difference. This changes what I said about giving the money away while you're alive so that you can see that it has an impact and you can control it. Because when you go to build these universities, endowments, and institutions, they still are subject to all the things that I said about a board.

So you want to be careful about that. But it is interesting to note that it wasn't as though he was trying to see all of the work done while he was alive. It was, however, that he was giving the money to – that he gave it away personally while he was alive, but he's still giving it to some institutions that are going on for a significant amount of time.

So those are the basic lessons that I wanted to draw from what Chuck Feeney did. And now let's talk about you. Chances are your wealth is a bit more modest than $8 billion or $10 billion or whatever Feeney started out with. We have a lot of multimillionaires in the radical personal finance community, but I'm not yet aware of any billionaire listeners.

And so what do you do as a multimillionaire who's trying to figure out what you do with your money? I think the first thing you got to do is you got to think through your personal philosophy of what you would want to do, what impact you want the money to have.

The most common thing that most of us look at is we want to help our children. We want to endow our children with wealth. Now, not everybody marries, not everybody has children, of course, but many of us do. And for those of us who do have children, that's very high on our list.

According to Mr. Feeney's Wikipedia page, Feeney is married twice. His first wife, Danielle, is French. They have $4, Juliet M., Caroline A., Diane V., Leslie D., and one son, Patrick A. His second wife, Helga, is his former secretary. So I don't know anything, I didn't find anything about what Feeney has done for his children.

But I would imagine that he has passed on significant wealth to his children. I'm just guessing. I could be guessing wrong, but it would be unusual for somebody not to want to help their children. I think the most famous quote here would come from Warren Buffett's work in the biography Snowball, which I read a number of years ago.

He talked extensively about his goal with his children was to leave them enough money to do anything, but not so much money that they could do nothing. And I think that in some ways that's a reasonable approach to have, leave them enough money to do anything, but not so much that they can't do anything.

But I think what people often get at this wrong is they often wait too long to give money to their children. One of the annoyances that I've always had about this type of planning is that if you wait until you die to pass along financial wealth to your children, they probably won't need it.

And or if they do need it, they probably won't have been able to get as much joy from the money, as much benefit from the money as if you had passed it along when they were younger. So I had my first child at the age of 27. And if I think about my expected lifespan, right, for years I've always said my plan is to die in a motorcycle accident on my 100th birthday.

Well, at this point in time, I'm starting to go beyond 100. My grandmother just turned 106. And so at this point, I'm moving my timeline out to, I don't know, maybe I'll aim for 120, 130, something like that. But let's just say that I trim down those numbers and I say something like 90 years old, right?

Let's pretend that I die at a common age of 90 years old. Where are my children going to be at that point in time? Well, my eldest child, if I died at 90, my eldest child would be 63 years old. If my eldest child had a baby at 27, then my grandchild, my eldest grandchild would be 36 years old.

And so you think about transferring money to someone who is 63 and you ask yourself, well, what does a 63-year-old need more money for? By 63, you're probably, the course of your life is probably pretty well established. In my experience, most people who are responsible, you know, 63-year-olds, they've established most things.

Not to say that they're necessarily rich or not rich, but they've established their lifestyle. And the needs for money that a 63-year-old has are fairly modest compared to the needs for money that perhaps a 30-year-old father might have. Right now, I have a higher need for money than I'll probably have at any other point in my life because of my children.

I have young children. The children are not financially productive. They're a drain on the family finances. We invest into the children heavily. There's a whole lot of infrastructure that goes with it. You need a larger house. You need a larger car. You're spending money on activities. You're spending money on teachers, on coaches, on things.

You're spending money on activities with them, even just fun activities. If I go skiing, it's not hard to spend $10,000 in a week if I take my family snow skiing because of the sheer number of lift tickets that I have. It's much easier to enjoy those active, expensive type of expenses when you have children that are financially dependent on you versus when you are older.

If I go somewhere, I need two hotel rooms. If I'm buying airplane tickets, I'm buying them six at a time. The financial costs are significant. On the other hand, when I'm 63 years old, the financial costs are likely to be far less significant. There will be two of us rather than six or more.

Life will be simpler. It's not to say that people can't spend a lot of money. It's just that the time when the spending feels the most required is when you have younger children, when you have minor children. Older people or wealthy people can easily spend a lot of money.

We can go out and have a dinner for two that costs $400 at a nice restaurant on Palm Beach or in New York City or wherever you like to go. It's not hard to have a $300 or $400 dinner. But that same couple could just as easily go and have a very enjoyable $25 dinner at a lower cost place and enjoy the experience of being together every bit as much as they can enjoy the $400 dinner.

On the other hand, if you have a family with four children, it's much more difficult to make a $25 dinner happen with a family with four children for six people than it is for two. The point is not that older people or wealthier people can't spend a lot of money.

They can. But it's a lot harder to get away with those things when you are younger. I mean at this stage in our family life, if I want to take my wife out, there are the expenses. There are obviously the expenses of taking children out, which we're very fortunate to be able to do.

But there are the expenses of taking children out and/or even if just the two of us want to go out, there are the expenses of a babysitter. It's just life is more expensive. So if you're looking for a time when it makes sense to give your children money, I'm of the opinion that it makes sense to give them money earlier.

That it makes sense to give them money early when it's useful to them. Now I've talked about, and I'm going to have a couple of shows coming down the pike this week or next, about how to do that. But even with regard to education, I've tried to promulgate the idea that money that you want to spend on your children's education is best spent when they are young.

And so most things, when you spend the money earlier, in most things it can be spent better. I spend a lot of money on books for my children to read. I spend a lot of money on education, on experiences for them. But I'm convinced it's better for me to invest in them now when they're young than to wait until they're 18 and then to buy some mythical college degree that's going to solve all the problems.

If I do my job now, in the first five to ten years of their life, they'll never need a dime from me for the rest of their life. And they won't ever need a dime from me for a college degree. The college degree can be easily self-financed in any number of ways if I do my job now.

But if I don't do my job now, then down the road that college degree may have some influence on them, possibly, but probably not a huge influence on them. So let's talk about expanding out beyond just education. Because of course, wealthy parents will invest huge amounts of money in their children's education, as we should.

It's a good investment. But what about other things? Things like buying houses for your children. Well, when's the best time to inherit a house? Is the best time to inherit a house when you're 65 years old and you are trying to figure out, you know, you just, "Oh, okay, dad died and he left me this house." Well, by 65, you've probably already got a house that you're living in that's probably reasonable enough for you.

And you've probably already got a house. It's probably already paid off, right? It's not hard to buy a house and have it paid off by 65. On the other hand, if you inherit a house when you're 30, that probably makes a much bigger difference for you. To inherit a house when you're 30 is a time when you have all those kid expenses.

And so if you have a debt-free house that dad gave you, now maybe you can afford to take your children to Europe every year. Now maybe you can afford to make the private school tuition payments into your children's lives. And since that's probably when you're at your more modest earning years, it makes a lot more sense.

Let's talk about the career for a moment. This is another big thing that if you look at a 63-year-old, there's a very good chance that a 63-year-old is in the highest earning years of their life. Not always, but very good chance. And so you have low expenses and high earnings.

Whereas many 30-year-olds are still trying to figure out how to keep their head above water, how to figure out their career. They've been bouncing around. Maybe they went to college. Maybe they're still trying to figure out, "What do I want to do?" It's unusual for a 30-year-old to be earning a lot of money, but it's much more common for a 63-year-old to be earning a lot of money.

And so having extra money from mom and dad can be very helpful at that early age because it allows the 30-year-old to live bigger experiences, to do nicer things. It really enhances the lifestyle of the younger person in a way that it doesn't have the same percentage effect for an older person.

Money and income can also be helpful when somebody is younger because it may allow them to go in an area that has more long-term value because there's a delayed gratification. Let's say that you have a wealthy father and the wealthy father says, "Here, I'm going to give you a house and you have a house to live in," and that allows you as a young 30-year-old to take a job that is a better fit for you but earns less money.

Well, you have less financial pressure so you can do that. That's going to pay off bigger over the long term than working a job that pays you more money now but doesn't have as good of a long-term future for you personally. All of these things can be adjusted by the individuals involved.

But in almost every example, what I've always come to the opinion of that the money is more helpful for your children when you're still alive, when it's younger than it will be just to inherit it when you're old because by then they probably won't need it. Now that's not to say that we should just be freely giving our children tons of money from an early age.

I don't know exactly what the right thing to do is. I didn't grow up with wealthy parents and so I've always prided myself on not having taken any significant financial support from my parents once I got out of high school. And that's always been something that I've looked at it and seen that, you know what, that built character in me.

I've seen that it was a good thing. However, as I'm growing older, I'm coming to realize that there are a set of experiences that since I didn't come from the money class that maybe I don't have an accurate understanding of how valuable it can be for parents to give their children money.

I find as I work with my own children, I find myself doing things that, you know, where I say, "Listen, I'm happy to give you money. Money is not the problem. What I want you to do is I want you to put your effort and attention over here in this other thing." And I've generally in the past had the personal impression that if parents gave too much money to their children that their children would turn out to be lazy or entitled.

And certainly there are lazy and entitled children. But I think that there are other ways to do it. There are other ways to adjust it and that it doesn't have to be that way. And sometimes if a child has character and is not lazy and entitled, getting the money can be a major benefit to them.

Having access to a family bank that they can use to fund their business projects or to fund some of their personal needs can be really significant. And so I'm not sold that wealthy parents just give their children tons and tons of money because I think that that has too high of a risk of turning children into dependents.

But I do think that there is value in children having access to the family bank, the family financing, etc. But even from the perspective of pure consumption, let's say we're not talking about anything that's going to grow, we're not talking about business investments or educational investments, but a pure consumption, I think it can be a real joy and a benefit for wealthy parents to facilitate really nice consumption items for their children.

And so you might simply want to invest your money into something that creates a great lifestyle for your children. Maybe it's going ahead and buying the beach house that's going to be an anchoring point for family gatherings for a very long time or buying the lake house or the mountain cabin or whatever your version of that is, the ski chalet.

Having the place that's the family property that people go to can be a great investment in your family culture and building a strong family, giving your grandchildren an anchoring point. It's not just consumption, it's investment into the younger generation. Maybe you go ahead and outfit that house with the toys that make it really fun, you know, the season lift tickets, the nice boat that anybody can take out and use, and you fund those things and that builds, it's an investment into your family culture.

I think that having the joy of that is something that more parents, more wealthy people in the middle and second half of their life should consider. I've frequently given that advice to parents and to grandparents. I've said, "Listen, you should start spending more money and you should invest the money into your children.

Why are you trying to stack up this giant inheritance that you're going to randomly leave to these college funds? Wouldn't you rather fund a really great annual vacation with your children? Wouldn't you rather take all your grandchildren to Europe and spend a month traveling all around Europe in style?

Wouldn't you rather have, again, that big lake house that everyone's going to come to on the 4th of July and everyone's going to come to for Thanksgiving and everyone's going to come to it at Christmas? And wouldn't you rather fund those big things and build a family culture of togetherness?

Wouldn't you rather make sure that you invest in the property that's suitable, that you hire the caterers so that we can have these big giant parties and that you pay to help everybody get there every year if necessary? Wouldn't you rather enjoy spending your money when you can be there rather than knowing that when they're all at your funeral they're saying, "Yeah, I got some more money from mom and dad." Now, the size of your wealth will vary and will make your use of the money, it has to make sense at your scale.

And so there's a big difference between having $8 billion and $8 million. There's a big difference between having $8 million and $800,000. But if you get clear on what you're trying to accomplish, then it can make a difference. So that's the first thing is family. And I think that Feeney is right with regard to spend the money while you're alive, at least if you can.

Unless you have too much money where you can't spend any more money profitably on your family, spend the money while you're alive. Because spending the money in some of these ways I think has more impact than leaving it behind when you're dead. Now we could also talk about friends and helping friends out, but I think the same lesson applies there.

I just want to point it out quickly, but not labor on it. Some people say, "I want to leave money to my niece, my nephew, my uncle, my best friend, you know, the guy who's cut my grass for 20 years, etc." That's great. And if you have some money and you just want to leave that behind as a nice thing, fine.

You know, I had a friend of mine, a friend and neighbor who they were very, they didn't have much money, lived on social security and they for years were a caretaker, an in-home caretaker for someone who was wealthy. And when she died, she left them several tens of thousands of dollars in her will and it was a great blessing for them.

They paid off their house, they bought a riding lawnmower, etc. And so those things can be really, really nice and really good. But I still continue to believe that in many circumstances it's better for you to give the money while you're alive so that you can see it. And so whether that means that you want to affect it, for example, maybe you notice that somebody's in debt and you say, "I'm going to come and I'm going to pay off your debt for you, but here are the terms of my agreement." You can do that when you're alive in a way that you can't necessarily do that when you're dead.

Even if you're giving the money anonymously, you can have the joy of giving the money anonymously and seeing that the money, seeing the joy that comes with it even through an anonymous gift. You can rejoice with your friends that, "Wow, somebody died and left me this money or somebody gave me this money anonymously," and you can be excited for them without them ever knowing that it came from you.

Or you can give the money to them or you can use it to build, take them on nice trips, do nice things with them, invite people into your circle and fund it so that you can enjoy the pleasure of their company. Spending money on people and even just to make friends is one of the most fun and best ways to spend money.

And it can help to alleviate even just your loneliness that may come at an older age. There have been plenty of times where you see somebody who is older and they got lots of money but they're lonely and I've often said, "Why don't you take some of the money and why don't you spend it on friendships?" And I'm not saying buy the person off, but spend the money on letting them be able to join you for things that they otherwise wouldn't be able to join you on.

When I was in high school and college I had a friend of mine who was an older man who was single and he did well financially and one of the things that was just a great blessing to me was that I enjoyed spending time with him and he financed it.

We would go out to dinner and he would pay for the food. We did different things together. Sometimes some of my brothers would go, my brothers were also friends with him, we had other friends in common and he would fund things that I wasn't able to fund. And he had things, he would let me use his truck, he would let me borrow one of his motorcycles, he would let me use some of his stuff and did it in a way that allowed me to have some really fun experiences and to do some really cool things and he got the pleasure of my company.

Now of course in our current very sensitive world, things like that you need to be cautious and careful because there are people who do things and use their money in a way that doesn't result in, where they don't have clear and pure intentions. And I'm even intensely conscious even as I describe what I just said how it can sound a little bit strange.

But in this case it was genuinely just a genuine relationship of friendship and I still consider him to be a very good friend and it's just been a blessing. And so he as a single man, no children, etc. was able to use his money and spend it on his friends in a way that helped him to have more companionship and friendship and to have more fun than he would have had otherwise.

And so spending your money on your friends is a very reasonable thing for you to do and very well worth considering. And we now turn to the third big thing that people want to leave their money to which is charities, some sort of charitable endeavor. I think a lot of money, personally, my personal opinion, I think a lot of money that is spent on charities is not spent very well.

And it's usually not spent very well because of the difficulty of doing charity well. And so people often revert to the easy solution, the thing that is easy for them that doesn't cost them time and effort to be involved. They say, "You know what, I had a good experience at my college and so I'll leave my college some money for their endowment." They say, "You know what, I like animals and so I'll leave some money to this big animal charity." Or, "I had breast cancer and so I'll leave some money to the Breast Cancer Foundation." And charities need money.

They survive on money. But I think what I've observed is, and the reason I say it's not spent well, is that a lot of times the money that is left to charities in this way is, number one, left without strings attached. It's just a gift given to the charity, which I think is a poor way to give money.

I think that you should expect a return from your money and you should place conditions onto it. Now, those conditions should be things that you think are appropriate. And it's not to say that you're going to be guaranteed a return on your money, but when you're giving money, it should come with conditions.

It should come with an expectation of proper usage. So in the same way that you wouldn't give your 16-year-old son, who's addicted to drugs, you wouldn't give him $100,000 cash and say, "Here, do whatever you want." You would say, "I'm going to give you things but they're going to come with strings attached.

You need to do the same thing with charities. Second reason I think it's often poorly done is people give their money into things that they can't make a big impact. So the classic, maybe giving it to a big breast cancer research and you say, "Okay, well, I had breast cancer so I'm going to give a $10,000 contribution to this multi-billion dollar breast cancer research foundation." Listen, it's your money.

You can do what you want. I don't understand why you would do that. A $10,000 donation to a multi, you know, hundred million, multi-billion dollar in some cases foundation, that, you know, that puts you on level 37 of their donor list. It's not level 82, which is the $10 a month guys, but it's level 37.

Why not take the $10,000 and give it to something where that $10,000 makes a big difference? Why not find, you know, do the work and find an independent researcher where the $10,000 helps them or the single mom with breast cancer where the $10,000 helps her pay off $10,000 of credit card debt?

In the same way that I think that we should invest our money at an appropriate scale where we're going to get a good return based upon the amount of money we have, I think that we should invest our money in charity at an appropriate scale. So if you've got $8 billion to give away, then a giant breast cancer foundation or a giant institution makes a big difference.

But just imagine, right? Think about what, you know, what Feeney gave away to Cornell, right? He gave Cornell University $965 million, but you're a Cornell grad and you're going to go, you know, all around and get all excited about leaving Cornell University a million dollars. What's the point? Where you could leave that million dollars to some itty bitty university and you can establish something that's going to be life changing in terms of your impact.

Your million dollars left at Cornell University is completely immaterial. Now their director of planned giving will of course say that it is and what do you want named after you? We can name this scholarship and blah, blah, blah, blah, blah. But why not find somebody where your million dollars makes you a big fish?

And the reason you do that is because it allows you to exercise your vision of what should happen. Whatever you think should happen is up to you. But you find someone that fits your personal ideology and then you do that. Don't be lazy with your charitable giving. But in addition, I think that you should give it while you're alive.

And in a minute we're going to pivot into some of the cursory overview of the financial planning implications. But if you give it while you're alive, you can give it, you can see the work being done and you can pull it back if you need to. So whatever the scale of your wealth is, if giving $100 is the scale of wealth that you are, where you are, then give the $100 to a place where the $100 is going to make a big difference.

If you're at the scale of $1,000 or $100,000 or a million or 10 million, figure out where can this money move the needle. And then figure out who at this scale is doing a really good job so that I can make a big difference and I can put the money there and I can double the results.

It can amplify the impacts. With charities, is it fine to give money away to charities when you're dead? Of course it is. But I think your better bet is to plan to give the money away while you're alive so that you can see it and make sure that it is properly handled, that you can see it and you can make sure that they don't all of a sudden change their mandate.

And you've got to pick when is the right time in your life to do it, but I think it's best to do it while they're alive, while you're alive. And of course, without question, while they're alive. Don't leave your money to a dead charity. Let's talk about financial planning now.

Why don't people give away more money when they're alive? Well, they don't, usually they don't give it away because they're not sure if they're going to need it. They don't know if I'm going to need this money for me. I might have unexpected medical expenses. Inflation might take off like a rocket.

I might not be able to, you know, I might want to spend more money in the future than I'm spending now. This looks very different when you're 30 versus when you're 70. When you're 30, your lifestyle expenses are very much not determined. They're not planned. They're not clear. When you're 70, most people by the time they're 70 will have chosen a lifestyle that they feel is appropriate for them.

Most 70 year olds have a fairly decent expectation of what they expect their long-term expenses to be. The big unknown is generally medical expenses because people don't know what kind of medical expenses they might have. They leave generally a fairly large amount of question mark related to medical expenses.

But I've not personally interacted with any 70 year olds who said, "Well, I'm currently spending $300,000 a year to maintain our lifestyle. But you know, in the future I might spend $600,000 a year." Just doesn't really happen. So once you reach the second half of your life, you're probably going to have pretty well laid out your personal lifestyle, your personal living expenses.

Now let's pretend, let's say it's an interesting financial experiment. Let's pretend that you wanted to make sure that you bounced your last check. Literally you wanted to make sure that you bounced your last check. How could you do that? How would you do that? Well, with regard to your investments, you would have to figure out how to turn your investments into an income stream where they had a terminal value of zero.

There is one very clear winner here and that is an annuity contract. That is what an annuity contract is. That's what it does. An annuity contract is the opposite of life insurance. Life insurance is a scheme by where you pay premium payments, monthly annual premium payments to the policy, and when you die, it creates a pot of money.

On the other hand, an annuity contract is a way of taking a pot of money and then paying you out payments for the rest of your life. The most obvious annuity contract that virtually all of us have is some form of pension or some form of retirement payments that come in from your government.

In the United States, this would be the social security system. In other countries, the name varies, but some kind of retirement pension. The beauty of a retirement pension in that form is you receive an income and when you die, the income stops. Now you can do this also in the private market.

Some people have what's called a defined benefit pension. I worked for such and such big company and when I retire or I worked for as a teacher or I worked for the fire department or the police department and when I retire, I get 50% of my retirement salary coming in for the rest of my life.

I know I have $6,000 a month coming in every single month for the rest of my life or I have $20,000 a month coming in every month for the rest of my life. You can do this same thing with a pot of money. You can always buy yourself a personal annuity payment.

You can say I've got $2 million here sitting in my 401k. What I'll do is I'll take that 401k, I'll roll it over to an IRA and I'll take it to an insurance company and I'll buy an annuity with the $2 million in my IRA and I'll get a series of monthly payments guaranteed to come in for the rest of my life.

Maybe I get $8,000 a month every month for the rest of my life and then I elect to have a two-thirds survivor benefit so that when I die, my wife gets two-thirds of that for the rest of her life if she outlives me. Then when we both die, then the money is totally gone.

I think this is a very reasonable way to do it. If I wanted to make sure that I had an income stream that was going to last for my entire lifetime, I would do it with an annuity. When you do retirement planning, annuities are really powerful because they allow people to budget based upon income which is how we're accustomed to budgeting.

They allow you to say, "You know what? I have X amount of dollars of income and so I'm going to take this income and I'm going to spend it and I can spend all of it." This is one of the most incredible things about wealth planning. People who focus on, I think of it like the American style of net worth versus the English style.

If you read an old Jane Austen novel, you always hear wealth referred to in the form of income. So Mr. Bingley has 19,000 pounds a year, right? That's his income. Or if you're reading an old Jules Verne novel, Monsieur Fogg has whatever he had. He's got income because income is what you spend.

In the American context, we usually talk about net worth. So instead of saying, "Oh, so and so is worth $300,000 a year," we say, "So and so has $3 million." The problem with net worth is that it's hard to turn it into income and income is what we spend.

Now of course, if you have a $3 million net worth, you could choose to spend $3 million in a certain month, but it's easier if you know my budget is $20,000 a month. If you knew that you had $20,000 a month coming in every month for the rest of your life or if you knew that you had $100,000 a month coming in every month for the rest of your life, then you're good to go, right?

You know this is my budget. Usually you can budget from month to month. Maybe you have $20,000 coming in a month and you want to take your children on a $30,000 cruise. So one month you constrict your spending, you pile that up for a couple of months, then you quickly spend it.

But having a guaranteed income allows you to spend freely. You're not constrained by, "Am I overspending or am I underspending?" Spending money off a portfolio can be very stressful for people. So what often happens is they underspend what they could spend. If you've got a portfolio with $5 million into it, you can go to your financial planner and they say, "Well, we calculate that you can actually spend your X number of years old so we calculate that you can spend 4.2% so therefore you can spend $210,000 a year." The problem is that if all that money is invested into say mutual funds, they can't guarantee that.

It's impossible to guarantee that level of spending and so you're left with something else. Well, what are the obvious solutions? Number one is you can buy income-producing investments. Maybe that's dividend stocks so then now you're spending your dividends. But now you're underspending what you could spend because you could spend dividends and you could also spend principal very safely but then you're back in the same situation.

So annuities solve this problem beautifully because they're designed to liquidate that sum of money. So if you literally wanted to bounce your last check, what would you do? You would take whatever sum of money you're going to live on. You would buy an annuity or a series of annuities depending on your strategy.

What I would do is I would make some of those annuities subject to inflation growth. So I would make some of them variable annuities with stocks inside the annuities so they would keep up with inflation. I might have some of them fixed annuities for a guaranteed portion that wasn't subject to any ups and downs.

And then what you would do is you would dispose of your other property and you would simply spend your income. And so to the extreme perspective, you could rent a house. You could rent a very nice house or a modest house but you could rent a house. You could lease a car.

You could literally eliminate all your physical property and then you just simply have income payments. You spend your money every single month. Maybe you save a little from month to month to handle any other thing. You would probably keep aside a lump sum of money, a hundred grand or whatever is appropriate, a couple hundred grand to serve as a reserve account.

But you would just spend all your money. I think that this kind of planning is really neat and by that I mean tidy. I very much like the idea. At certain phases of my life, I want to own a big house. But when I reach a later phase of my life, I don't want to own a big house.

I want my children to own a big house and I'd be happy to visit them but I want to live in a modest apartment or a modest house. Or probably ideally, I want to live in a modest apartment at my children's house or in a modest place out back, something like that where I don't have to deal with the hassle of maintenance and upkeep.

I just want to have a modest place that gives me a couple of rooms to be in and I want to be surrounded by people I love. And so the ideal solution for me, at least imagining myself as a grandfather, the ideal solution is I want to live with one of my children or maybe have a little place with all my children or something like that where I can be close to my children and my grandchildren but not have the hassle of a big house, etc.

But you could do this just with a rented apartment and I think that it's very tidy to arrange things in this way. And now, can you do it also with your own house? Of course you can. And so I'm just playing the mental game of what if we wanted to die with zero dollars of net worth so that I could give it all away.

The problem with having your own house that you live in is while in theory you could establish a reverse mortgage, that's I think generally inadvisable to somebody who isn't desperate for the money. So if you have your house, you're going to have an asset here that has a value that is eventually going to be passed on.

Nothing wrong with doing that. You can just simply, it's very efficient, right? I lived in the house for a long time. I'm going to have this house set aside for my children. They're going to inherit it. They're going to sell it and they're going to split the money. Fine.

Totally reasonable. But I think it's simpler if you even disposed of your real estate just for the purposes of our mental experiment. What if you did want to leave some money to your children as an inheritance when you die? Or if you wanted to just have some money available?

Well, life insurance is I think the obvious solution here. If you say, "I need to take care of my final expenses and so I'm going to set aside and have a $100,000 life insurance policy. That policy has going to have proceeds that are designed to bury me. That policy is going to have proceeds that are designed to care for any final estate administration expenses, pay off that last check that bounced, etc." Then you can just have that.

If you wanted to, let's say that somebody hired me and they've got $10 million and they say, "I want all my children to inherit $1 million each. But I don't want to give it to them now. I want to give it to them when I'm dead. But I also want to have an income that's modest and I want to make sure that I give the rest of my money away while I'm alive." You can do that with life insurance as well.

So pretend that person bought three $1 million life insurance policies or one $3 million life insurance policy and they designate their children as the beneficiaries on those policies. Then now on the date of their death, then within a few weeks or a few months, their children will each receive a million dollars cash.

It's a very efficient way to transfer money. It's very, very clean. And the nice thing about a life insurance policy is as a way of establishing inheritance is a few things. Number one, a life insurance policy is clean and it can be done without any worrying about people contesting the will.

So for example, maybe you have three children and you want to disinherit one child, but you want to inherit two children. If you have $3 million of property that you leave behind in a will, then your disinherited child can attempt to contest the will, sometimes successfully, sometimes not. A good planner can of course build something that's virtually incontestable, but at the end of the day, if you have a will, the child can contest the will.

But if you have a life insurance policy and you simply establish that your two children are the beneficiaries and that your third child is not, there's nothing to contest. The disinherited child has no legal recourse to be able to contest that life insurance payout. It's a contract between you and the insurance company.

It's not a will that they can contest. Other nice things about life insurance as a form of estate transfer to beneficiaries is that life insurance is intensely flexible. And so you can change at any point in time the beneficiaries of the policy. You can establish a trust or not establish a trust.

You can have all that stuff and you can do it very, very easily at any point as long as you are of course competent to make changes to your policy. Another nice thing about life insurance, of course here we're obviously talking about some form of whole life insurance policy.

Term insurance doesn't work for this. But with a whole life insurance policy, you have cash reserves. And so if you're trying to say, "I want the money to be there for an inheritance, but I need to have a little bit of wiggle room. I need to have some money that's available for me." Well, you can always borrow against the policy.

So if somebody has unexpectedly high medical costs and those medical costs aren't covered by other sources of income, then of course you can borrow against the life insurance cash values and then the insurance company will pay off that loan upon your death. And so that's a really nice solution as well.

The other thing that you can do in this situation is you can insure for medical costs with proper insurance. And so that would be of course a health insurance policy that's appropriate for you and then possibly a long-term care insurance policy. And so a long-term care insurance policy should be able to be designed that it would cover any significant increase in expenses due to long-term care, thus eliminating that financial burden from your investment portfolio and also from your children.

So that's the simplest and cleanest way. And in that scenario, if somebody used those financial tools to do it, in that scenario, you would be spending on your credit card up to your budget amount that you're living on, your $20,000 a month or $10,000 a month coming in from your annuity.

Every month you would just simply pay off your credit card bill, you would pay your rent, etc. Then when you died, you would have no estate because you've already disposed of all your property and you would literally balance your last check because you would spend your credit card and go out for a $500 dinner the night before your death, you die.

Immediately your insurance, your annuity funds stop as of the date of your death and so you don't have any more payments but your checking account is empty and then the credit card bill comes due a month later and there's no money to pay it. And then the life insurance policies would pay out the death benefits to your children and you would literally balance your last check.

You have no estate, the credit card company would eat the cost of your $500 payment assuming you had no money in your checking account in that scenario. Now that's just a fun game to think through about how would I do that. But you can step back from that now and look at perhaps more serious proposals to say what do I do with my other assets.

So maybe I have $8 million in stocks. Well if I bought with $2 million, I bought enough income for me to live on, then I can go ahead and give away those $6 million. I can give them away whenever I want to and I can give them all away because I know I've guaranteed my income.

I'm sure of my income and so I can give away all my other money. Similar things with property. You could do this of course with real estate. Maybe you're living on a rental income portfolio and then you'd simply designate that at your death those real estate properties get donated to a charity or given to your children or anything.

If you have other assets, then there's no reason to go out taking life insurance policies out if you have another asset that you would want to be passed along. And there may be significant financial benefits to choosing other assets. We don't want to forget about tax planning for example.

If you had maybe you had three rental properties and you have three children and you identify that one of these rental properties is going to go to each child, you may have could potentially have millions of dollars of gain in those properties and now those properties would receive a step up in tax basis at the date of your death and then be passed along to your children.

You might have highly appreciated stocks and the same thing would happen or other long-term capital gains property and so it would be very advantageous for you to use that as part of the assets that you passed along to your children rather than to keep them for yourself. So there are many ways that this could be done but if you start with the idea that this is what you want to do, it'll clarify some of your planning and give your professional advisors something to work with as far as you have a clear intent.

So you can play with the details for yourself. I want to close by talking about assets that I would not do this with. I don't personally have the ambition to balance my last check. Now I'm so young that it's impossible for me to know where I'll be at 70.

There could be a very wide range of opportunities. But I don't think that for I think for many people I don't think Mr. Feeney's plan is actually the ideal plan. And let me talk about some of the assets that I don't that I think should not be used in the way that he did it.

I think the most obvious asset would be if you have some form of business that your family is involved in. I think that one of the best assets to build and develop is a business or a series of businesses that become a part an integrated part of your family culture.

It could be a duty-free shop, sure. I don't know why he chose to do that. I don't know if his children were not involved in it. But if I had built a string of multi-billion dollar duty-free shops, number one, I can't see why I would want to go public.

And number two, I wouldn't sell. I would keep the business. And with the income from the business, I would go ahead and use that income to fund charitable endeavors if I felt that that was appropriate. But I wouldn't sell any of the business to myself, at least what I can guess.

Now again, I haven't been there. Maybe it would be different if I were on the other side of the table and I actually had done what he did. But I can't imagine that I would do that. I would keep the business and I would keep it as part of my family's identity, my family business.

This would be the family business. And I would use that family business as an anchoring point for the family. Number one is it would provide the family with a steady stream of income. That income can be spent. There's the income for educations. There's the income to help people get established.

Importantly also, it would be part of the family identity. It would be part of where they would be employed. I would employ my children. I would employ my extended family. I would bring people into the business and we would use it as a training ground. And we'd use it as a training ground to grow it even bigger.

And I would train my family and I would set out a family vision of here's what this business is going to be and here's what this business stands for. And then pass that business along to hopefully faithful children who would then pass it along through the years. But I would much rather have a family business that can support the branching out family tree that would come under our family rather than just pass money along.

I think that money is often, while I stand by what I said earlier that it can be very useful, I think that money is often the most hollow thing for children to inherit because money doesn't come with any soul. It's just money. It's just spendable money. It doesn't come with family identity.

It doesn't come with those things. And so I think that a business, I would not break up a business just to give it all away while I was alive. I would keep the business. I would be happy to give away income. But I would keep the business and have that identified as the family business and have it be a training ground.

Because I think that it can do far more good that way and I think it would be very hard to find a better investment than the family business. If you got a highly profitable family business, why would you go and take all the money out of that and then go and invest it into a bunch of other people's businesses?

Well, you do a little bit for diversification, but for the bulk of your wealth, is that really what you're going to do? I say no. I say keep the family business and then train people to run it well. Now, of course, a family business can also be combined with a family foundation and that can create more opportunities for the family to be employed within the business, within the foundation, to help to work things.

That's the ideal structure. But I personally can't imagine that I would liquidate all of my shares in a highly profitable business just to give the money away. Not everybody has a family business, so what other assets would I not liquidate? I would be very slow to liquidate a family property, especially if there were a family property that had some form of identity.

Now this, meaning that this had been important to the family for a period of time. This is notoriously difficult, especially if you're trying to leave an equal inheritance. So pretend that you have a nice lake house and you've got four children or three children or whatever, and some of your children like the lake house and some of them don't.

Well, that's really tough. It's tough for a planner because they've got to figure out, well, do we sell the lake house? And maybe two of your children say, "No, we don't want to sell it." And two of your children say, "Yes, we want to sell it. We want the money." So what I would do is I would try to set up and establish that this property is going to stay a family property for a period of time, and I would set up the financial infrastructure to fund for the expenses of that property.

We might set up, put the property in a trust and put enough income in it, put enough money in the trust that it could handle the property's expenses for a period of time so it could remain the family's property. That gets difficult with who's going to use it when, et cetera, but I would want there to be, if there's a family property, maybe we have a family farm or we have this, those things I think can serve as a really neat anchoring point of the family.

And so if you have a property like that, then I say, think it through carefully, but I would be cautious about disposing of it too quickly. I didn't used to think that way. Ten years ago, I didn't think that way. But today, getting older, seeing my children get older, I think I'm convinced that I was wrong before, and I see the value in that.

My wife and I are talking about what is it that we can do that will be part of our family property. And I'm thinking about things that will be long-term, things that don't make a lot of money but that have a form of identity. So I'm considering, well, do we buy a ranch?

Do we buy an olive grove, an olive farm? What is it that we can do that will be, this would be our family place that gives a sense of identity? And it's basically a place that your children can retreat to. It might be the place of summer vacations, but then what if one of your children has a setback or gets fired or something like that?

Do you have a family property that they can retreat to? They can go back to, they can get their feet under themselves and can reestablish? I've become acutely aware of this, even just for myself over the last number of years, is that my family in Florida, we had a big property that was where we grew up.

My dad had built this big house, but then he sold it and he moved into a condo and none of us wanted to keep the big house. At the time, that seemed like the right move. And my dad was glad not to have to deal with the upkeep, etc.

But what I've realized now is it's very hard for me because I don't have an easy place that as a family I can go back to in Florida. We no longer have the family place. And since I dissolved all of my property there, it leaves me with these family connections, but without any physical connections to the place.

And so that's hard. It feels a little bit strange for me to say, "Well, I'm going to go see my family, but I'm going to stay in a hotel." That's never how I imagined this phase of my life being. And so I've come to appreciate some of those things as well.

There are other assets as well that obviously shouldn't be sold. There may be family assets and maybe physical assets, things that are unique to your family. But I think I've made my points. When you are thinking about your estate, recognize that you're going to have the responsibility to dispose of your stuff in a way that's going to be helpful.

And I think that one ambition that you can have in your mind is to have a tidy estate, to not leave a bunch of stuff. One of my grandparents died and he left a bunch of property and he left a farm, but his farm had a 20-acre junkyard on it.

And it was a blessing, of course, to the family to inherit this thing. And of course, when farmers die, you inherit property. That's how the farming business works. But it is a 20-acre junkyard and it took years and years and years to clean it up and scrap this and whatnot.

It was a huge project. And I don't see how he could have done anything different. I don't think it would have been possible for him to do it. But I think that one of my ambitions is just I don't want to leave junk behind. So if I assume that I die as an old man and I don't die young, then I don't want to leave a bunch of junk behind.

I want to have things taken care of. And so having this basic goal to give away all the money while I'm alive, to me, it rings true in my heart with the caveat stated. Even with things like the business, that should be given away with, again, technical details behind the scenes with what it actually means to give it away.

In theory, if I reach an old age and we have a family business, I don't want to be operating the family business anymore. Maybe I'll still technically own shares. Maybe the shares have been moved into a trust. Who knows? It depends on where you wind up in your personal planning.

But I don't want to be actively operating it anymore. I want to have gone ahead and passed it on to the younger generation so that they can have full ownership and not wait until they're 63 years old to inherit the family business. That's wrong. You shouldn't be a 90-year-old guy still running the family business and then making your 63-year-old son who's going to take over as CEO wait until you die to take over.

It should be done earlier than that. There should be a healthy form of succession put in place. So I love this conceptually. I love the idea of giving the money away, giving it to my children when they're young enough for it to do them some good, giving it to the grandchildren when they're young enough to do them some good, giving it either in the form of physical cash, investing into paying bills, passing on assets, giving it to them in experiences that they wouldn't otherwise be able to achieve due to their age.

But I don't want to die with a bunch of money unspent. I don't want, you know, say my little thing, don't send me flowers at my funeral. Send me flowers before. I can't smell them. I can't see them. I can't enjoy them when I'm dead. Send them to me now.

Let's not wait until, let's not save millions of dollars and then leave it to our children and then the children go on a ski vacation in my honor. Let's take the children on a ski vacation and do it when I can still ski. So I hope these ideas are useful to you and may you know wisdom as you put together your own circumstances.

As I close today's show, I want to remind you of a course that I sell at radicalpersonalfinance.com/store called How to Survive and Thrive During the Coming Economic Crisis. What I'll tell you is that some of the ideas that I discuss in that course can form a fundamental foundation and for me they do of what I'm describing here.

So let's say that you lay out a goal and you say, I'd like to have an asset that is going to be passed on through the years. Maybe we live in, I don't know, Massachusetts, but I'd like to have an olive farm or I'd like to have a ranch.

So you can just simply make this a fundamental part of your overall long-term plan. Maybe you decide that what we're going to do is I'm going to buy a ranch in Western Canada. I'm going to buy a cattle ranch in Western Canada and that's going to be the family property.

And so to make that happen, maybe you, of course you don't have to be a Canadian citizen, but that would help. So perhaps you devote a few years of your life to going to that ranch, to setting things up, commuting back and forth to Massachusetts, use that time period to become a Canadian citizen and then your children to become Canadian citizens and now you're dual citizens.

But what you have now is you have a ranch that can be the family property that we go spend summers at the cabin on the lakes in Ontario or the ranch in Western, you know, in BC or wherever you wind up going and you use that as your anchoring place.

Maybe you run some cattle, you have a local caretaker that lives on the property and cares for the property for you and then you outfit that property with the things that your family needs for fun. Maybe you keep horses there so that we can ride horses when we're there and do all of the fun Western ranching things.

You outfit the property with reserves of, you know, make it energy independent. You put reserves of food and supplies and other things that you would need there and then you have a backup location in another country. So if something goes wrong for you in Massachusetts or in the United States, you now have your cabin in the lakes of Ontario or your ranch in Western BC.

Maybe you say I want to buy an olive farm and so you shop around and maybe you find something in Croatia or in Montenegro or in Greece or Spain. And so in that course we talk about going ahead and setting up some of these things in advance and then establishing the necessary paperwork.

So you go ahead and become a Spanish citizen so that you can have your olive farm or get the Montenegro residency so that you can get access to that and that becomes the place that you go for vacation. You're right on the Mediterranean, you've got your olive farm, this is the place that you're going to go, but it's also convenient for you.

If you needed to leave the United States, you now have the ability to do that. This entire course was birthed out of my observation that the best thing to do, the best way to survive and thrive during any kind of crisis is simply by not being where there is a crisis.

And in that course I talk about two basic approaches. Number one is being provisioned and prepared, supplied, stockpiled, the things that you need so that if there's an economic crisis you have the things that you need prepared. But then on the other side to be able to go to some place where there isn't a crisis.

And you can even see right now in a pandemic, about the only thing that can shut the world down completely is a pandemic. And so what we're seeing right now is a pretty good stress test of what do you do if all of a sudden some guy gets shot in your town and there's riots in your town, do you have a plan for that?

What do you do if your country is shut down for pandemic restrictions or you decide you need to go somewhere else? Do you have a safe place that you can go to get away from the mess in situation A? And so I just encourage you, it's a great course.

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