Wealth For Generations
Dive into the essentials of wealth management with Ian Weiner and Todd Whatley on Wealth For Generations. This podcast brings you concise, expert insights on investment strategies, retirement planning, Estate Planning and financial well-being. This dynamic team of a Certified Financial Planner and Certified Elder Law Attorney are perfect for anyone from beginners to seasoned investors, our episodes focus on empowering you with the knowledge to make informed financial and estate planning decisions. Join us for clear, friendly guidance to navigate your financial future with confidence.
Wealth For Generations
The Terminal Dollar: Redefining Financial Success - Beyond Security to Significance
Ever wondered if you’re managing your wealth for maximum impact and fulfillment? Find out how to transform your financial perspective by exploring the concept of the "terminal dollar" with our experts, Todd Whatley and Ian Weiner. This episode challenges you to rethink your financial goals once you've achieved security, delving into the essential uses of money—spending, investing, and giving away. Todd and Ian guide you through the mental shift that comes with assessing your financial journey, offering practical advice and real-life client stories to help you overcome lifelong frugal habits and make meaningful decisions about your surplus wealth.
Imagine valuing your time more than your money and prioritizing joy over obligations. We discuss how to strategically delegate tasks to reclaim your time for activities that truly matter. Personal anecdotes illustrate how letting go of certain chores can lead to a more fulfilling life. We also tackle generational differences in spending and saving mindsets, and the advantages of witnessing the benefits of your gifts to family members while you’re alive. Ultimately, this episode empowers you to gain clarity in your financial decisions and use your money as a tool to enhance your life and legacy. Don’t miss out on these transformative insights!
Welcome to Wealth for Generations, the podcast where you learn to grow, protect and preserve your wealth for generations. Our hosts on today's show are Todd Whatley, a certified elder law attorney, and Ian Weiner, a certified financial planner. Join us and our expert guests as we uncover the mindsets, tools and strategies to help you maximize your wealth and impact. Let's embark on this journey to secure your legacy. Please note this podcast is for informational purposes only and is not intended as financial or legal advice. Always consult with a professional regarding your specific situation.
Speaker 2:Hi there, thank you so much for joining us today and today's another exciting podcast, and I'm Todd Wally and I am here with my co-host, mr Ian Weiner. Hey man, how are you?
Speaker 3:Todd, I'm doing well. I think this will be a halfway decent one. Usually, I say it's going to be a good one, but I like to set expectations low early and often.
Speaker 2:I think this is going to be really good and I think our goal today is to get you to think a little bit differently. Yeah, think about why you practice, why you go to work every day, why you save money, why you do stuff, and the title today is going to be the did you do stuff? And the title today is going to be the. Did you say the terminal dollar? The terminal dollar. Explain what that?
Speaker 3:is what to do when you've won the game. Maybe we write a book about this. That's a cool one. I can't remember who I ripped off this term from the terminal dollar.
Speaker 2:Sorry, it's one of my colleagues. If we wrote a book and put it in the title, we'd probably find out real quick.
Speaker 3:Yeah, we'd give him some money or something. But the idea is let me just pause for a second. I like making people think Okay, because if I have to be burdened by all of the thoughts that I think, I think you should have to have some of them too, sure. Anyway, I'm just joking, but the concept of the terminal dollar is this Maybe we'll rename it something else and get away with it, but I love this concept. At some point in your life maybe this has already happened you have earned the last dollar that you will ever spend. Let me say it again At some point in your life it could be when you're younger, it could be when you're older, it could be the last day that you live you will have earned the last dollar that you will be able to spend.
Speaker 2:Okay, so we grow up, we get jobs, we go to college, we can make more money, ideally, so we can buy stuff houses and cars, and food and insurance and things like that, maybe even have a little fun now and then. Yeah, and you stick some back, so for a rainy day, later day, retirement, so that you can have money to spend throughout your life. But at some point that amount's going to grow to the point that you won't spend past that dollar. Okay, that's another way to think about it. So many of us you obviously don't know when that is, you might could kind of estimate but most of us keep on working, keep on saving, keep on investing so that we make sure we have that. So today's show is to think about what about those dollars past the terminal dollar?
Speaker 3:And we can figure out pretty well when that amount is Okay, and so we can help you get clarity on that. I don't think I'm there yet. I don't know. Who knows, I keep working.
Speaker 2:Yeah.
Speaker 3:And some of it is. It's not bad to work doing what you love. I mean, the goal is not to just have money and then not do anything. That's when people wither and don't do well, so we don't want to encourage that. But the idea is there are three different things that you can do with a dollar you can spend it, you can invest it or you can give it away. Really, I mean, that's pretty much it right, and so if you're not going to spend it anymore, typically people would either invest it or give it away, and so what we want to begin to think about is okay, let's say you do win the game Not everyone wins the game, by the way, but let's say you do.
Speaker 3:When you say win the game, what does that mean? You've achieved your terminal dollar. You have more money than you will ever spend. This tends to be a lot of clients that we see, and sometimes the behaviors that contribute to this are being frugal, saving well, investing well, and so if you do that for 40, 50 years, it's hard to unwind those behaviors.
Speaker 3:I understand that. I mean, this is a real thing. I had a call with someone just a couple days ago. Four and a half million bucks they spend $50,000 a year and they're like we need to get a new part on the house. It's going to be $8,000, like a little wall thing built it's going to be $8,000, and I just can't and I just can't and I'm like if you don't spend that $8,000, I'm going to lose my mind, because it's like it's literally a rounding error for them, sure, but they just like they have their honest, good, hardworking people, you know.
Speaker 3:And so we started to have this conversation about the terminal dollar and like, all right with it, and I want folks to begin to think about that a little bit and hang with me, as we're just a little bit philosophical here today, but hang with me because if you can get clarity around the purpose of the dollars after your terminal dollar, it brings a lot of stuff into perspective and in a much different way. You know some of the clients that I work with. You know they will have achieved their terminal dollar quite a bit younger than some of my other clients. I have someone who about $20 million net worth single individual that was after he had a pretty nasty divorce and lost half of it in the divorce and blue-collar guy, blue-collar worker, just business hardworking he won't spend 75 grand a year.
Speaker 3:I mean, a big event for him is going to the NASCAR race and that's what he wants to do. But it's important to him that the money goes to the next generation and the generation after that, and so what he's beginning to think about is okay, the investing and the giving. What he's beginning to think about is okay, the investing and the giving. Why is that important for our family? And how do we do that? How do we build a process to do that? Because the easy part is transitioning it from one generation to the next. So here's the thought pattern If you're not going to spend the dollar, you can either invest it and give it to the family or you can give it away.
Speaker 3:So we've got to think about that transition. In a technical sense, the easy part is figuring out how we transfer it, whether that's in trust, whether it's an outright gift, what have you? The hard part, especially when you're keeping it in the family, is how do you transition the value system? I mean, that's you know, and if you're like, oh, that's not a big deal, I'm not worried about that, get the checkbook out and stroke a check to your kid and we've done a podcast on this, yeah.
Speaker 2:Is that third generation is the problem.
Speaker 3:Yeah.
Speaker 2:Because the second generation sees you work, sees you maybe go from not much to have quite a bit. They see you get up and go to work. They see how you spend the money or not spend the money. They see how you invest. They see how you do this and they'll incorporate some of that. But that third generation then sees the second generation not work as hard and mainly not have to do things like the first generation did, and they don't have the value system. They're more removed from that Absolutely and so very few fortunes make it past that third generation. That quick.
Speaker 3:Yeah, it's about a 10% success rate. Wow, yeah, those aren't great odds. Just, you know, most people understand that If you weren't sure, look, there's a 10% chance you're going to win. Yeah, that your third generation is going to win, and that may or may not bother you, and that's okay if it doesn't. And if it doesn't, great, we can make the last check bounce. We say that in meetings with clients. It's like okay, what do you want to happen? Well, I don't really care. Okay, let's, let's make the last check bounce and they're on their own. And if that's what you want, great. I mean, that's what you, it's, it's your money, that's what you built.
Speaker 3:But if that's not what you want, what is the process for transitioning? Only the assets, and most people need to do work on that, but we can do that, that's not that complicated for us. But also, then, what's the process for transitioning the values and the vision and helping them to steward it? And so it changes your mindset from okay, how do we keep investing money Great, that's part of it To how do we invest in the family, or how do we invest in the community, and what's important and it's a shift, or even up to that terminal dollar are to help you buy your time back. Really, we talked about this on the radio show today. I said radio show. It's not the radio show anymore.
Speaker 2:It's not on the radio anymore.
Speaker 3:No, no more silence. We talked about this today on the Facebook show. That there's. I totally lost my train of thought. What was I going to say? The radio totally threw me off. That was sad. But you get to a point where you realize and hopefully this happens before your terminal dollar you get to a point where you realize that time is your most valuable resource. And it's tough for me, frankly.
Speaker 1:I do a lot of stuff myself.
Speaker 3:I'm like I do my own hair, I do my own dental. There's a lot that I do. I'm just kidding.
Speaker 1:I'm mostly kidding, I used to.
Speaker 3:I used to cut my own hair. It's just more efficient. But at a certain point it's like it's okay that you don't do everything. You don't need to save money on everything. What's the purpose of that? Where is it supposed to go? That's really what we're asking. What is the purpose of that? If you're not going to spend it, who is? Let's plan around that.
Speaker 2:Yeah, and that's a mindset thing. My father-in-law did not go to college very blue collar and I'm sure he thinks differently than I do. Particularly when I hire someone to do something that I could do it two hours, not cleaning out something or, you know, fixing something, I would just rather have someone else do it and I have those two hours to do something else. Okay, I still mow my yard, but I enjoy doing it. Okay, that's the key, and I enjoy doing it. I don't mind doing it. It just kind of gets me out and does something. I do something and I enjoy seeing it going from rough grass to oh, that's smooth grass, I like it. Yes, I could hire someone to do it and I could reclaim that time, but I enjoy doing that.
Speaker 2:But there are things that I don't like to do and that's where you, as the listener you make, and the real purpose is to first stop doing things you don't want to do and then, number two, try to make a difference in the next generation. And that takes forethought and takes planning, and you can't just leave it to them. You can't just do a will and say at my death, here are things divided three ways. Here it goes and hope that that works out. Hope is not a strategy. Hope is absolutely and particularly for that, that second generation may do okay and if you leave them enough to eventually get to the third 10% chance that it's gone, yeah Well 90% chance that it's gone.
Speaker 2:Oh yeah, 10% chance that it does well, sorry, yes, 90% chance that it's gone. Oh yeah, 10% chance that it does.
Speaker 3:well, sorry, yes 90% chance it's gone. Do something right, you know. And look, I know this is like kind of philosophical, kind of emotional, you know, sure, but I mean, you feel better when you have clarity about why you do the things that you do. A really interesting exercise. If you want to do this, I'm going to encourage you to do it. And it's a little bit harder if you're retired.
Speaker 3:But we can get pretty well what your effective hourly rate is and maybe you know what your hourly rate is If you own your business. It's a little different, right, but you would divide your income you can do pre-tax just to be nice here Do. Your income divided by 2,000 is roughly a 50-week working year. See what your hourly rate is, and that's fine. It doesn't matter what it is, it's good, bad or indifferent, it's just the number. And then next time you're doing something that you don't want to do, get out the checkbook and, and you know, for that hour, just write the check for that amount, and then it really makes you think through it a little bit differently. One hour.
Speaker 2:Yeah, yeah, there's a consultant. That I think one of the first things he did when he came on stage. He's like, okay, who out there would pay $300 an hour for someone to come clean your house? Everybody's like, no, that's expensive. $300 an hour to clean my house God, he said. When you're cleaning your house, if you make $300 an hour, you're paying someone 300 bucks an hour to clean your house. If you could do it for 100 bucks an hour, isn't that a pretty good deal? And you're like, wow, I hadn't thought about it, so I'm paying a pretty high rate to have my yard mowed.
Speaker 2:But, that's okay. Right, that's okay, I don't mind.
Speaker 3:The money is a tool. It's meant to be spent or invested or given away right, and that's the purpose of it. But again, think about these things and are you spending, investing or giving the dollars that you intend to right now, and are you on track for that? Because when you are, it just changes so much Like it's so freeing to go look, I'm doing exactly what I want when I want, and it's actually a lot more control than people that are afraid to spend any money because they don't know what their situation is. So if you don't know, that, that's where you are.
Speaker 3:So if you don't know that that's where you are and if you're able to do that, we can have a conversation. I mean, in a technical sense, we can figure out where you are on that spectrum and figure out how to do that. But if you've gotten there maybe you've saved really well or planned for retirement and you've done really well and you have excess income maybe there's a different conversation we need to have. You know, and I really I counsel a lot of my clients to consider gifting to family while they're here, proactively, because you know it's and it doesn't have to be done irresponsibly. There's really thoughtful ways that we can do it, you know. But I mean, imagine when you were 30, 35, 40, uh, growing up and you know young kids in the house. A couple extra bucks would have made things a big impact versus getting a lump sum when you didn't need it. Sure, and in a sense that's pretty inefficient actually.
Speaker 2:I mean, imagine giving your young family, your kids' family, enough money to go on vacation. They go to Disney World. They couldn't afford it, but you give them $15,000 here. Go to Disney World, or you go with them. Yeah, yeah, you can go with them, or you can sit at home if you don't want to do Disney World, but look at the pictures. Hey, send me pictures. My only requirement is post on Facebook or do something, but send me pictures and you see the joy in their life that you did that and they would not have done that but for you.
Speaker 2:I'm a huge advocate of planning and, yes, I do Medicaid, and Medicaid penalizes gifting, but you can do it appropriately and I encourage that people do that because you get to see the benefit of your money. We always talk about boats. If your kids really want a boat, buy them a boat. The two best days of buying a boat is the day you buy it and the day you sell it. But hey, that's why we're not buying boats, that's why best days of buying a boat is the day you buy it and the day you sell it.
Speaker 3:But hey, that's why we're not buying boats.
Speaker 2:That's why we're not buying a boat. But I have bought a boat. But you get to see the joy that it brings them and they know this came from you and they might invite you to come ride the boat sometime and they'll probably take pretty good care of it knowing that you're watching.
Speaker 3:It's about impact. What is the amount of impact that those dollars can have? And I think the main reason, in my opinion, that more people don't do this is because they don't think they can. Right, and if you don't have clarity about that and I guess I'm talking my book here, but if you don't have clarity about that, we need to fix that. We need to have that conversation. You know, because the I mean literally the scenario that you talked about.
Speaker 3:I didn't, you didn't even know this one, a client that I was just working with that's exactly what they're going to do is take the family to Disney, and you know, they came in and they did not think that they were in the position to be able to do that. And we rearranged some things and they're going to be able to give quite a bit of money away every single year and they are so happy they have been. They're like this is amazing. I never thought that we could do this. I'm just so excited and it's like to me it's like no big deal. It's like, yeah, I just did the right thing and we organized stuff, but we know exactly how much money you need and you're past that point, and so, if you don't know that.
Speaker 3:We got to figure that out because, like, what holds you back from, what holds a lot of people back from living the life they want to live, is fear.
Speaker 3:I mean truly, if you think that you're not going to have enough and you haven't done the work or hired me to do the work to figure out if you have enough, of course you're going to feel uncertain and feel like you can't do this kind of stuff. It's natural to be afraid, but you don't have to be afraid. You can plan and we can get rid of that fear. And look, if you're not there, I'll tell you that and be candid and we'll make a plan to get you there, Right. But I mean, if this sounds like something that is interesting to you and you don't know whether you can do that kind of stuff, but it's on your heart and you want to, we've got to fix that. Especially, people that have worked hard and saved, to not know what they can spend and when and what that process is, is a planning failure to me. Who cares if the IRA gets another $100,000 if you're not confident that you can spend it or give it away? It's kind of tough but people will benefit from that.
Speaker 2:Alright, Good topic Interesting stuff to think about.
Speaker 2:Hopefully that got people thinking. As always, if we can help you, we would love to work with you. Call the Generations Legal Group office. She may be a little confused. If you're calling and you're asking about something, Just say hey, Todd and Ian said to call, and can you get me in touch with Todd or Ian and we would love to talk to you and discuss with you how to plan for those dollars after the terminal dollar and really make your life better and fun and enjoyable. And you've earned this money. You've worked hard. You've earned this money. Let's let you enjoy it. Let's let you do something correct with it.
Speaker 3:Do the rest of the work. Just a little bit of extra work to make sure that you can All right.
Speaker 2:Thank you all very much and we will see you next time.
Speaker 1:Thank you for joining us on Wealth for Generations. We hope today's insights inspire and guide you in your financial journey. Remember, the path to wealth and legacy is unique for each of us and we're here to help illuminate your way. Before we part, a quick reminder this podcast does not provide financial or legal advice. The content discussed is for informational purposes only. Please consult a financial planner or legal advisor for advice specific to your situation. Visit us at wwwwealth4generationscom for more resources and don't forget to subscribe to Wealth for Generations. Until next time, keep building your legacy, one decision at a time.
Speaker 3:This material is intended for educational purposes only. Nothing in this material constitutes a solicitation for the sale or purchase of any securities or insurance product. Investment advisory services offered only by registered individuals through Exoswell Strategies LLC. The firm is a registered investment advisor and may only transact business with residents of those states or residents of other states where otherwise illegally permitted, subject to exemption or exclusion from registration requirements. Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining value. Some of the information contained on this website shall constitute an offer to sell or solicit any offer to buy a security or any insurance product.