You can create generational wealth so that you can pass it down to your kids.
It will not only make your life better, but also affect your kids, your great-grant kids and so on. You could literally pass it down, and this is the key to being wealthy.
This is what all the wealthy people of the world know which regular people like us do not even have an idea about.
We are going to discuss multiple ways to create and pass generational wealth in this article!
What is Generational Wealth?
“Generational Wealth is an Asset.”
It is an asset or assets, things that you can pass down to your children and their children and so on. Moreover, it also something of more excellent value.
Not just anything that is passed down like — you have a lamp, and you think like, ‘let me pass this lamp down to my kids’.
It is not like that. It is an asset.
We can often get to hear it as family wealth or legacy wealth.
I want to remind you guys what good debt and bad debt is.
Good debt puts money in your pocket, and it is an asset, whereas bad debt takes money out of your pocket, and it is a liability.
I know using big words, liability, asset but what it boils down to is, ‘If you buy something that puts money in your pocket that’s an asset’.
You can pass it down to your kids as a generational wealth, and they can continue to do that so on and so forth.
“An Asset Puts Money Into Your Pocket.”– Robert Kiyosaki
Let me give you some key criteria of what good generational wealth is:
Generational Wealth Creates Passive Income
Passive income is where you work one time and get paid over and over again.
Just like if you write a best selling book and it continues to sell year after year. You wrote the book one time and it continually makes you money.
Not like a J.O.B. (Just Over Broke) where you work an hour and get paid for that one hour.
Real Estate Rental Property Can Be Generational Wealth
If you buy a real estate rental property that makes passive income every month, it can be termed as generational wealth.
Stocks Can Be Generational Wealth
Stocks might be making you money in dividends or something like that. That is generational wealth! You can pass it down to your kids.
Generational Wealth Must be Able to Pass It Down to Your Kids
There are certain things you cannot pass down to your kids or that you probably would not like.
E.g., a car. You buy a fancy car, but in 10 years from now, it will be worth less than it is now.
Twenty years from now, it will be worth much less and then 50 years from now, it will probably worth nothing. It would fall apart.
Similarly, you cannot pass down your job to your kids.
It should be an asset that appreciates over time
It should be an asset whose value is appreciated over time.
E.g., you can buy gold and pass it down to your kids. Your real estate rental property that gets value growing over time is generational wealth.
Your house that you live in and you want to pass it to your kids is a generational wealth because it appreciates over time.
What is not a Generational Wealth?
Now I would like to explain you things that are not generational wealth before I get into how you can build it and actually pass it down to your kids.
‘Your job’ is not generational wealth. Your boss would not just hire your kid unexpectedly. They have to actually apply and prove themselves to be hired for that job position. You cannot pass down your job.
Your car is not generational wealth because it will eventually depreciate. It is not making money, and finally, the kids would prefer to buy their own car.
Now, do not get shocked to hear this! Physical money is not generational wealth. It is wealth but not a generational wealth. The cash sitting at your vault is not going to grow because the time value of money decreases over time.
It cannot be called generational wealth if you pass that down to your kids unless you have like literally a hundred million dollars. If you pass down a million dollars that million dollars will be gone eventually.
You want to have generational wealth that sticks around for a long time.
If you have, 10 million dollars that would potentially stick around for a long time with the interest it can be called a generational wealth.
However, your kids should be able to live off that asset.
Something substantial like real estate or stocks or a business that has a value of its own and makes money is generational wealth.
How do I pass the desired asset down to my kids?
An annual gift would be something that you would be able to give to your children.
Always check with your accountant on what is the total amount. For example, let us say your kids are five years old now if you have the means to give them fourteen thousand dollars once in every five years (Tax-free).
They will have fourteen thousand dollars times five, i.e. about seventy thousand dollars. If you can give them seventy thousand dollars over five years and not be taxed on it, wouldn’t that be phenomenal for them?
Nevertheless, it is not necessarily generational wealth.
If you have, a business and you hire them that is also another way to transfer that generational wealth to them.
I personally have more than 30 rental properties, and I do not sell them. I hold on to them because that is how we feed our family. We live off the passive income.
I am literally giving those to my kids, but the way that I do it is through family trusts. We have a living trust, and we are the trustees of it.
The kids will be the beneficiaries after our death. They will get every bit of ours.
So, if you are going to have generational wealth and you actually have significant assets, put it in a trust.
What can you pass as generational wealth?
You can pass down several things, but I am going to start with the most basic one: Knowledge.
This is not necessarily going to make them money, but it is coming from your experience and knowledge. You can pass down knowledge of business regarding how to carry out a particular work.
They are going to be so much wiser from all your wisdom. My wife, and me, we homeschool all four of our kids. We also teach them how to make money. We teach them about how to buy properties and how to invest.
I do not want to rely on somebody else to teach my kids what I know. I know I could teach my kids so much better about how to make money and how do you learn to do everything. Therefore, I am teaching them.
Teaching them these kinds of knowledge and providing financial literacy is significant generational wealth.
Building a business that you can pass down to your kids.
It could be a brick and mortar business with an actual physical location, or it can be an online business. Let me give you a small example. Let us say you created a website that generates traffic.
It has google AdSense and creates ads on that website. You can absolutely pass that down to your kids. That website is now theirs once it is passed down to them.
So, think of businesses that you can create and as you make these businesses think about how you can eventually pass them down to your kids.
I also have a YouTube channel and a podcast called ‘successfully unemployed’ because not everybody wants real estate.
However, there are so many ways to quit your job to be successfully unemployed to have generational wealth, and building businesses is one of them. So check out my show successfully unemployed.
Go into any podcast app or YouTube and find it. You will find that I have interviewed so many great entrepreneurs who have already become successfully unemployed.
Watch my podcasts to figure out a way for you to create a business that you can pass down to your kids as a generational wealth.
Real Estate Investing
Real estate investing is so near and dear to my heart. It creates passive income and appreciates over time. I can pass it down to my kids.
Generational Wealth Is to Give Your Home To Your Kids
Suppose you buy a house to live in when you start having kids; think of how you can pass this down to your kids. The ultimate goal is to leave our kids better off than when we started.
Company stocks are another great way of generational wealth, especially if it gives dividends. Dividends paid every quarter from the income that the company makes puts money in your pocket. You can also take those shares and pass those to your kids as well because you own part of a business.
Side Hustle — Create An Online Business
A good side hustle if you want to get started in generational wealth is actually to create an online business.
There are multiple business options online, as well. You can become an Etsy seller.
They sell crafts and handmade products. Alternatively, you can also create an eBay account and start making money, creating a business out of that.
You can create a website that has traffic. You can create a podcast that gets sponsorships.
You can even create a YouTube channel and actually put your kids on there with you as you are building your channel.
They will eventually take over, or you can say promote kids channel as they branch off and start building up their channel.
Generational Wealth Conclusion
There are literally dozens of ways of creating generational wealth that you can pass down to your kids.
All you need to do is, stop procrastinating and start it now! You are one step away from creating a Generational
Wealth. Go through this blog again, make your decision, and follow these amazing ways to create and pass down your wealth to your kids right now!