How do wealthy families pass wealth across generations?
Short answer: Vince said this planning requires giving up control of assets. Bank funding and replacing withdrawals let money in the trust compound.
At a wealth presentation, Peter described his family office, then investor Vince discussed trust planning.
Vince on Rockefeller trusts
Vince said the Rockefellers set up irrevocable trusts and funded them with insurance vehicles. He said they put money back into the estate when money was taken out. (at 10:12)
Vince on replenishing withdrawals
Vince described replacing withdrawals from a trust as his strategy. He said people have to give up control of their assets when doing this kind of wealth planning. (at 10:40)
Vince on bank funded trusts
Vince said he had big banks that would fund irrevocable trusts at roughly 4% or 5% interest. He said the insurance vehicles could earn 7%, 8% or 9%, and the money could compound in the trust. (at 12:57)
"A lot of people have a problem doing that because you have to lose control of your assets"
From Richard's exclusive Billionaires.com interviews
Lessons from Richard C. Wilson's one-on-one interviews, as published on each interview page.
- Anu Aga: Check before you give. Study the work of an NGO, ask more questions, and visit it if you can. This leads to an informed decision.
- Tim Draper: Make your customers your sales force. Hotmail put a message at the bottom of the screen inviting people to get free email. It spread to 11 million users.
- Don Wenner: Commit to scale. Don's major turning point came when he decided to build a great company that makes an impact. Making money and being successful was not enough for him.
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Frequently asked questions
How do wealthy families pass wealth across generations?
Vince said this planning requires giving up control of assets. Bank funding and replacing withdrawals let money in the trust compound.
What can a basic AB trust do?
Vince said it can establish a basic estate plan and help avoid probate. [12:28]
Who did Peter say he works with?
Peter said his family office shares strategies and deal flow with other single family offices and works with high net worth families. [5:56]
Sources
Quotes are copied from the video captions and checked against the transcript. Timestamps link to the moment in the video. General information only, not legal, tax or investment advice.