It’s been said that generational wealth–assets passed down from one generation to the next–don’t often make it past the third. In fact, in many instances, growing generational wealth is considered the “easy” part. However, without intentionally setting aside time to plan ahead, your loved ones may not reap the support of what you’ve worked hard to accumulate.

Legacy planning for generational wealth is rooted in the strength of your financial foundation, and when thinking about your future, learning how to effectively strengthen that foundation is essential. For example, when defining exactly what “legacy” means–specifically for you–taking your values, ethics, principles, traditions and hopes for the future into account will help clarify your goals. 

However, it doesn’t stop there. Having conversations with your family to communicate your vision is also an imperative part of the process. The added benefits of continued open dialog also helps to eradicate potential confusion experienced by your children and/or grandchildren in understanding your plans. In addition to this, although your family won’t know every detail of your finances, involving them will remove any airs of secrecy, while letting them know how much you trust them. 

Remember, meaningful wealth transfers aren’t solely connected to monetary value, so a great place to start is through determining what possessions, financial or otherwise, you would consider passing down. From this perspective, an invaluable, yet often glossed over, element of generational wealth to hand down is financial education.

Taking the time to go over the value of money, how to save and budget it, as well as how to invest will help contribute to a positive mindset. It is likely that the earlier conversations around financial literacy occur, the more likely the future inheritors will feel comfortable in managing what they ultimately receive.

Going about achieving your goals will require discipline, and there are several ways you can go about beginning to do this:

• Prioritizing savings
• Creating financial security with emergency funds
• Ensuring your children are financially literate
• Investing in financial markets
• Investing in real estate. 

Preserving these assets can be achieved by:

• Building an estate plan
• Maximizing tax benefits
• Avoiding debt by living within your means. 
• Enlisting the help of a financial advisor is always encouraged. 

The future starts now, and while legacy planning for generational wealth may necessitate a few sacrifices upfront, your efforts will not be in vain. The peace of mind that accompanies the source of financial support you’re providing for your loved ones is well worth it.