2. Invest in the stock market
Investing in the stock market is a great way to build wealth in your lifetime and hopefully pass it down to your next generation. Learn the risks and strategies of investing wisely in the stock market and find a trusted financial advisor who can guide you through it, while also understanding your overall goals and plans. An advisor can help you choose the right investment accounts, the right investments to go within those accounts, and find ways to build systems to review your accounts on a regular basis to ensure they’re working correctly.
3. Diversity with real estate or entrepreneurship
Investing in real estate is another great way to build generational wealth. You can invest in rental properties that pay you the rental income, which you can use for cash flow now and ultimately, pass down that cash flow to the next generation. You can even buy into commercial real estate through private investments or real estate investment trusts. Slowly and surely you can build an estate portfolio.
If you’re a business owner you can consider leaving your business to your family. In any case of passing a business, liabilities, or wealth to your children, make sure they are aware of your wishes. Whatever you might plan to pass down, you want to make sure you work with an attorney to have the right legal documents in place to carry out your wishes and to ensure a smooth transition.
4. Protect yourself with life insurance and an estate plan
Life insurance is one of the only ways to provide tax-free income to your dependents in the form of a benefit upon your death. Because it can pass tax-free to your beneficiaries, it is a great way to provide generational wealth. Work with a trusted financial advisor who can walk you through the different life insurance types and help you understand all the details to make sure you get the right policies in place and have the correct legal documents in place. This is a way to provide your loved ones with an income stream to care for their lifestyle needs or help financially set them up for their future.
With generational wealth, it is extremely important to get the right estate planning and legal documents in place so that all of your wishes of passing down your assets actually hold true. This includes making sure the beneficiaries are accurate on all of your accounts, making sure your living trust and other estate planning legal documents are up-to-date, and having conversations with family members and the people involved so that everybody is clear about your wishes.
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