Look Out For Pirates
Listen to “Look Out for Pirates.”
This morning I am in New York serving on a panel at the Praxis Redemptive Imagination Summit. Here is the assignment: “As tectonic shifts happen in technology, secularization, wealth creation, and business as a mechanism for impact, the theologically minded philanthropist or foundation executive may face tough decisions in the years to come: should we invest in tech-driven solutions? Or focus on relationships that may get left behind in the pursuit of scale?”
For me, redemptive philanthropy is preparing the next generation of family for wealth and giving. I want to invest in redeeming inheritance.
Today, wealth is synonymous with money or other financial assets. One hundred years ago it would have been the family farm. Leaving that wealth to the children was natural and there was little thought about “ruining” them in leaving wealth. What was different? Just this. Parents started the children out early in their lives with a sense of responsibility. They had chores when they were young. They had animals to care for – not just pets. They had associations with others living on farms through FFA and 4-H clubs. As they grew up they had genuine ownership of the wealth. They had responsibility for it. They knew everything about it their whole lives and they were prepared to inherit it.
Not so today. We isolate children from the responsibilities and “chores” of wealth. There are no official clubs and associations for them to learn about wealth. They associate through private schools, summer camps, and family vacations with others from wealthy families but they don’t learn about the “work” as they would have on a farm. Wealth is not tangible to them. It is a lifestyle. They don’t see it, feed it, plow it or contribute their labor to it. They are separated from it for the most part. They are the beneficiaries of wealth but not connected to it and so inheriting becomes a completely different issue. Many of our children have no way of knowing how to care for the wealth they inherit and so we worry about their being ruined by it. We didn’t worry about being ruined by the family farm because we were brought up and trained all our lives to inherit it.
What if we did the same now? What if we included our children in the care of wealth from early in their lives? Perhaps we might see fewer parents talking about the fear of ruining their children and more having the joy of their children inheriting what they had been grown to care for.
Several years ago I wrote, “I want to declare a war on pirates: all the organizations and financial planners encouraging people not to trust their children.” It’s true and I don’t quite know how to go about it (having never declared a war before) but I would like you to enlist. Like any war, we’ll figure it out as we go.
Actually, it is a response to a quiet war waged against inheritance and heirs for years. The investor Jim Rogers remarked, “Leaving children with wealth is like leaving them a case of psychological cancer.” Really? Is that all there is to say? Adam Pruzan called it the “anti-inheritance ideology,” which encourages parents who have accumulated wealth to guard their children from certain disaster. But its consequences can be even more insidious. It leads to mistrusting their children.
Obviously, it is not enough to simply pass wealth to your children without proper preparation, but if we are encouraged to assume it is better to trust others than our own family, then we will do little to prepare our family for their unique responsibility. More time will be spent with professionals creating strategies for managing wealth and philanthropy than teaching our own children. The commitment to passing wealth to your children takes hard work and must begin early or they will only see wealth as a lifestyle and not a responsibility passed to the next generation, as taught in Scripture.
I’ve written before that when my father died, he left my two sisters and me three trust funds. Nothing could have been further from his mind when we were young. In fact, there were more than a few times growing up when we had heated discussions about the role of money in our lives, the values we used in making decisions, and even organizations and causes to which we gave. That is why I was so surprised when Dad told me about the “trust” funds. How could he trust when we were so different? Isn’t trust being sure the next generation will comply with donor intent? Maybe not. Maybe what Dad had come to over the years was the confidence to trust without the necessity of agreement.
So, this morning I will talk about redemptive inheritance and building a foundation of trust and respect – not just money.