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I am a multi millionaire and I have 4 children. My plan is to not give any of them financial support in college and convince each of them to attain high paying jobs. The first one to pay off their student loans, purchase a house, and ends up with the highest net worth will be willed solely everything I own. My reasoning being they are the most responsible and thus will continue on my legacy of extreme thrift. In a couple generations of wealth building maybe one day we can be one of those "evil" family dynasties people will either complain about or whom will have a realty show made about.
I am a multi millionaire and I have 4 children. My plan is to not give any of them financial support in college and convince each of them to attain high paying jobs. The first one to pay off their student loans, purchase a house, and ends up with the highest net worth will be willed solely everything I own. My reasoning being they are the most responsible and thus will continue on my legacy of extreme thrift. In a couple generations of wealth building maybe one day we can be one of those "evil" family dynasties people will either complain about or whom will have a realty show made about.
Well, I'm not a multi-millionaire (at least not yet lol) so you might know more than I know. But I would actually do it to where you pay for a certain portion or amount of their college education, at a specific college per say. Let's say you want to provide $70,000 towards education at an Ivy League School, or maybe $40,000 towards a higher ranked State School. You can specify that the monies can only be spent on actual tuition, not room/board, meals or books which will avoid the children getting the money back in an access check and spending it.
Then once they graduate college and are earning at least "XYZ" amount for a certain period of time, you can look at having the Trust or Fund release another pre-determined amount to them as they would be adults at that point in time to be able to efficiently handle it.
With your plan, not sure how long it would take them to actually achieve that goal seeing as though you didn't define "high paying" job. Are you talking about a $75,000 job in NYC? That's equivalent to a $45k job in Michigan due to the higher cost of living, so you can't really define that as high paying right? Plus the burden of the student loans would weigh them down to a point to where they wouldn't get this KICK START in life, and would be actually in a situation like majority of other college students (or like myself personally), where it takes us until our late 20's/early 30's before we actually get to the Middle Class. Some of them NEVER make it to the Middle Class and stay around the Working Class level.
Having a Fund pay for their undergraduate degree at XYZ institution with a solid network for example, allows them to perhaps be recruited into a position that's highly sought after like let's say, Investment Banker. Their Employer would most likely pay for their MBA tuition at a Top Ranked School (which saves you money) and they can actually be living in a place like NYC and pulling in $150,000 - $250,000 a year by the time they are in their late 20's/early 30's which is in the top 1% of income earners in the country. That's a high paying position and strategically setting up your College Funds like that would help them get to this point more efficiently, faster and effective.
Well, I'm not a multi-millionaire (at least not yet lol) so you might know more than I know. But I would actually do it to where you pay for a certain portion or amount of their college education, at a specific college per say. Let's say you want to provide $70,000 towards education at an Ivy League School, or maybe $40,000 towards a higher ranked State School. You can specify that the monies can only be spent on actual tuition, not room/board, meals or books which will avoid the children getting the money back in an access check and spending it.
Then once they graduate college and are earning at least "XYZ" amount for a certain period of time, you can look at having the Trust or Fund release another pre-determined amount to them as they would be adults at that point in time to be able to efficiently handle it.
With your plan, not sure how long it would take them to actually achieve that goal seeing as though you didn't define "high paying" job. Are you talking about a $75,000 job in NYC? That's equivalent to a $45k job in Michigan due to the higher cost of living, so you can't really define that as high paying right? Plus the burden of the student loans would weigh them down to a point to where they wouldn't get this KICK START in life, and would be actually in a situation like majority of other college students (or like myself personally), where it takes us until our late 20's/early 30's before we actually get to the Middle Class.
Having a Fund pay for their undergraduate degree at XYZ institution with a solid network for example, allows them to perhaps be recruited into a position that's highly sought after like let's say, Investment Banker. Their Employer would most likely pay for their MBA tuition at a Top Ranked School (which saves you money) and they can actually be living in a place like NYC and pulling in $150,000 - $250,000 a year by the time they are in their late 20's/early 30's which is in the top 1% of income earners in the country.
The problem I see with paying ANY tuition means they'll see me as a source of money and they'll start to rely on me for money. I lived at home for decades allowing myself to save in order to become what I am today. I don't want my children to make money the same way I did (middle class income). I want them to further themselves by becoming lawyers/physicians/other high paying professions. As a result they won't rely on my money and will let it accrue interest while they add to the assets.
By "high paying" I'm talking physician, big law lawyer, executive, etc. If they make comfortably over 100k they will be well in the running in my book.
The one who amasses the most in net worth will be the one I feel will continue my legacy of hoarding money for the betterment of the family. The others, while they won't inherit anything from me, will still be very well off.
I will inform them of my plan before they go to High School so they know what they need to work for.
Last edited by KungFuMaster; 12-28-2014 at 01:44 AM..
The problem I see with paying ANY tuition means they'll see me as a source of money and they'll start to rely on me for money. I lived at home for decades allowing myself to save in order to become what I am today. I don't want my children to make money the same way I did (middle class income). I want them to further themselves by becomes lawyers/physicians/other high paying professions. As a result they won't rely on my money and will let it accrue interest while they add to the assets.
By "high paying" I'm talking physician, big law lawyer, etc. If they make comfortably over 100k they will be well in the running in my book.
The one who amasses the most in net worth will be the one I feel will continue my legacy of hoarding money for the betterment of the family. The others, while they won't inherit anything from me, will still be very well off.
Well, they shouldn't see you as a source of money in terms of calling you up for this and that, as long as you establish those boundaries and regulations. I would let them know how the deal is going to work and if they can't get on board with YOUR deal (as it's your funds) then you quite honestly don't have to setup anything for them. You can just remind them that most of us (like myself included) start out in life and also receive jack NOTHING from our parents even when they die. I know some people who have parents that died and LEFT them bills!
But here's what's wrong with your plan in my opinion. You are discussing them being doctors and lawyers, lawyers are a dying breed. I would shoot them for Medicine, Big 4 Accounting, Wallstreet Finance, High End Engineering, or getting into top management in Nursing if you want to be able to relatively forecast a $100,000 plus level of annual income.
In order for them to get here, they would need some sort of BOOST from you with funds already established and I would assume a network already established. Your kids ARE NOT getting into Big 4 Accounting or Wallstreet Finance without going to the Top Ranked B-Schools, and taking out student loans isn't going to cut it, they are going to need to utilize your "brand name" and network connections to get accepted. Same is for the Medical Field in terms of being a high end Doctor of some sorts, not just a Family Practice Physician (which are being squeezed right now).
Next, you are focusing on the children's net worth but not willing to help them with student loans. To get reasonably to the goal of $100k plus in income by the late 20's/early 30's, they are going to have to go to a top ranked institution with a network to get recruited into HIGHLY SELECTIVE positions that you can only get from those exclusive networks. This means they will have to take out $120,000 in student loans which even if they are making $100k a year they will still have a negative NET WORTH.
Well, they shouldn't see you as a source of money in terms of calling you up for this and that, as long as you establish those boundaries and regulations. I would let them know how the deal is going to work and if they can't get on board with YOUR deal (as it's your funds) then you quite honestly don't have to setup anything for them. You can just remind them that most of us (like myself included) start out in life and also receive jack NOTHING from our parents even when they die. I know some people who have parents that died and LEFT them bills!
But here's what's wrong with your plan in my opinion. You are discussing them being doctors and lawyers, lawyers are a dying breed. I would shoot them for Medicine, Big 4 Accounting, Wallstreet Finance, High End Engineering, or getting into top management in Nursing if you want to be able to relatively forecast a $100,000 plus level of annual income.
In order for them to get here, they would need some sort of BOOST from you with funds already established and I would assume a network already established. Your kids ARE NOT getting into Big 4 Accounting or Wallstreet Finance without going to the Top Ranked B-Schools, and taking out student loans isn't going to cut it, they are going to need to utilize your "brand name" and network connections to get accepted. Same is for the Medical Field in terms of being a high end Doctor of some sorts, not just a Family Practice Physician (which are being squeezed right now).
Next, you are focusing on the children's net worth but not willing to help them with student loans. To get reasonably to the goal of $100k plus in income by the late 20's/early 30's, they are going to have to go to a top ranked institution with a network to get recruited into HIGHLY SELECTIVE positions that you can only get from those exclusive networks. This means they will have to take out $120,000 in student loans which even if they are making $100k a year they will still have a negative NET WORTH.
I am okay with big 4 accounting/finance/engineering but I will not accept a nurse. That may disqualify them unless they're a NP. I wasn't specifically saying either doctor or lawyer.
If I know a guy I will most definitely try to convince them to hook them up with a job but if I do everything for them by paying for their schooling it will breed laziness. I do not want them to devolve into slackers who live off and squander my money in 3 generatons.
I will make them work HARD to get into their dream school. They are completely on their own. Since we live in California they're already set if they make it into UCB, (which they'd be only 40 miles away from), Stanford (5 miles from), or UCLA.
Since I'm rich mostly from investing 90% of my income my whole life and not by entrepreneurial-ship or a high salary they will suffer from a lack of strong connections and thus will need to rely on their own abilities.
Last edited by KungFuMaster; 12-28-2014 at 01:44 AM..
I am okay with big 4 accounting/finance/engineering but I will not accept a nurse. That may disqualify them unless they're a NP. I wasn't specifically saying either doctor or lawyer.
If I know a guy I will most definitely try to convince them to hook them up with a job but if I do everything for them by paying for their schooling it will breed laziness. I do not want them to devolve into slackers who live off and squander my money in 3 generatons.
I will make them work HARD to get into their dream school. They are completely on their own. Since we live in California they're already set if they make it into UCB, (which they'd be only 40 miles away from), Stanford (5 miles from), or UCLA.
Since I'm rich mostly from investing 90% of my net worth my whole life and not by entrepreneurial-ship or a high salary they will suffer from a lack of strong connections and thus will need to rely on their own abilities.
I understand, just don't think that plan makes any sense because you are judging them based on net worth and a high paying salary....but asking them to start from the BOTTOM like I had to with no assistance from my parents (financial nor wisdom assistance). It took me until the age of 26 before I starting making REAL money, because from 18 - 26 I had to bump my head to figure out everything in life. Sometimes people coming from the bottom like that make it, like I did....but all too often the "bumps" on the head that they take turn into concussions in which they NEVER truly recover nor reach the goal they wanted.
There's a steep learning curve they are going to have to overcome along with the ability to handle a HUGE amount of student loan payments unless they can win some scholarships. Those things combined will put them on the pace of someone like me coming from NOTHING when they are actually coming from MILLIONS lol, I don't think that makes any sense.
I don't see how paying for the tuition only creates laziness unless the kids are already lazy? You would setup the fund to pay for the tuition only and nothing to the child in terms of access money from the education funds. They are already going to have to figure out how to gain part-time employment, etc., so it's not like you aren't building character in them. Plus the tuition would only pay for the subjects outlined, which are DIFFICULT subjects. If the kid decides to drop out, then they lose access to all of the funds. That right there will motivate them to not be the sole loser of the family.
1) If you've raised them well, even with your help they wouldn't become slackers. They'd bust their butts to be able to do for you in return, and appreciation.
2) Why not encourage them to do what THEY want to do and would make them happy, productive people, instead of trying to bribe them into doing what YOU want them to do? Again, if they're raised well, they'll want to achieve.
I understand, just don't think that plan makes any sense because you are judging them based on net worth and a high paying salary....but asking them to start from the BOTTOM like I had to with no assistance from my parents (financial nor wisdom assistance). It took me until the age of 26 before I starting making REAL money, because from 18 - 26 I had to bump my head to figure out everything in life. Sometimes people coming from the bottom like that make it, like I did....but all too often the "bumps" on the head that they take turn into concussions in which they NEVER truly recover nor reach the goal they wanted.
There's a steep learning curve they are going to have to overcome along with the ability to handle a HUGE amount of student loan payments unless they can win some scholarships. Those things combined will put them on the pace of someone like me coming from NOTHING when they are actually coming from MILLIONS lol, I don't think that makes any sense.
I don't see how paying for the tuition only creates laziness unless the kids are already lazy? You would setup the fund to pay for the tuition only and nothing to the child in terms of access money from the education funds. They are already going to have to figure out how to gain part-time employment, etc., so it's not like you aren't building character in them. Plus the tuition would only pay for the subjects outlined, which are DIFFICULT subjects. If the kid decides to drop out, then they lose access to all of the funds. That right there will motivate them to not be the sole loser of the family.
I don't see how it will be hard for them to find work if they get a MD...
I am giving them my wisdom by pressuring them while they're young to get lucrative careers instead of being lazy. I will definitely give them wisdom and if they stay local for college I will definitely provide them a place to live. They will need to work or volunteer in order to live here though.
I might give the MD some slack for the sole purpose that he/she can take care of me in old age. In fact I might even give him/her leverage as long as he/she proves themselves to be financially wise.
I'm judging them on how successful they are so that they may breed successful babies and so on and so forth. I will also judge them on their choice of wives/husbands.
1) If you've raised them well, even with your help they wouldn't become slackers. They'd bust their butts to be able to do for you in return, and appreciation.
2) Why not encourage them to do what THEY want to do and would make them happy, productive people, instead of trying to bribe them into doing what YOU want them to do? Again, if they're raised well, they'll want to achieve.
If they want to become a starving artist or a teacher they can enjoy themselves with none of my money.
At least one will have the common sense to be successful.
pressuring them while they're young to get lucrative careers instead of being lazy.
Why "pressure" them to 'get lucrative careers'...what about being loving, kind, productive, thoughtful people.
You keep talking about your kids possibly being lazy? How old are these kids we're talking about? If you'e not doing your job well already -- and you can see they're turning out lazy -- don't pressure them because you couldn't raise them NOT be lazy.
What have you been doing, or not doing, that that's even an issue or possibility?
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