Rock musician Sting recently announced that his children will not inherit his estimated $300 million fortune, saying that these riches are “albatrosses around their necks.”
The product of a British working class background, Sting is currently one of England’s wealthiest musicians, but says that he will not be passing that fortune on to his six children. In an interview with the Daily Mail, Sting said,
“I told them there won’t be much money left because we are spending it! We have a lot of commitments. What comes in we spend, and there isn’t much left. I certainly don’t want to leave them trust funds that are albatrosses round their necks. They have to work. All my kids know that and they rarely ask me for anything, which I really respect and appreciate.”
While this may sound a bit harsh, Sting’s concerns about inherited wealth can be found among many parents (wealthy and otherwise) who wrestle with whether or not bestowing wealth upon their children or grandchildren will be a blessing or a curse.
Fortunately, estate planning does offer a valuable tool for parents and grandparents with these concerns: a Wealth Creation trust, prepared using incentive provisions.
A Wealth Creation Trust with incentive provisions allows you to pass along your values as well as your wealth by attaching incentives to the distribution of your assets. For example, if grandparents want to pass on wealth to grandchildren but want to be sure those grandchildren get a good education so they know how to handle their inheritance wisely, they can set up a Wealth Creation Trust that names the circumstances under which the assets will be distributed.
If your desire is to nurture your children’s entrepreneurial spirit, you can establish a Wealth Creation Trust to provide funding for a business startup, which allows you to foster that spirit while passing on your values regarding the benefits of hard work.
While most parents want to leave something behind for their children, passing along a solid set of values along with inherited wealth is generally the desired outcome. A Wealth Creation Trust can allow parents and grandparents to accomplish this worthy goal.
Contact a Personal Family Lawyer® to schedule a time for us to sit down and talk about a Family Wealth Planning Session, where we can identify the best ways for you to ensure your legacy of love and financial security for your family.