I thought I’d depart from our usual investment and economic analysis and share a client story. Though I’ve changed some of the personal details for the privacy of the client, I thought you might enjoy learning about some of the ways we work with our individual and family clients.
Richard is an 89-year-old widower who came to us with a problem. He had given his eldest granddaughter $10,000 for her wedding and was worried about what he could do for his 10 other grandchildren, ages 15-24.
We recommended a meeting with his estate attorney. At the meeting, we all agreed Richard should create a Trust for the benefit of the 10 grandchildren and fund it with $100,000, or $10,000 each. He named a son and daughter as co-trustees and directed that each grandchild would receive his/her one-tenth share when each turned 30 or married, whichever came first. Richard wanted the funds invested in conservative growth investments that had the potential to appreciate at least in line with inflation while also capturing some of the upside associated with a growing economy. As the accounts grow, he hopes that his 15-year-old grandson will be able to withdraw more than $20,000 by the time he’s 30.
Richard then wrote a letter to each grandchild explaining his gift to them which he gave them at Christmas. Here’s the letter that Richard wrote.
December 25, 2017
Christmas is my favorite time of the year. It is a time for celebrating the birth of Jesus, a time of hope and thanksgiving, and a joyful time for family. Family has always been the most important thing in my life, and it was for Nana too.
Nana and I were blessed: we had each other for over 50 years; we had four children; and we had you. At 89, I have done a lot of things, been a lot of places, and known a lot of people, but none of the rest of my life holds the importance or meaning for me that my family does. My family is the center of my world and the motivation for all that I’ve done. I’m telling you this because it has made for a happy life, and I hope it will do the same for you. The advice from Pop-pop is to hold your family closely and dearly. They will always be there for you and in your corner.
I worked very hard in my life, and I was determined to provide for my family and at all times be financially cautious and responsible. I was cautious about not taking too much risk and even more cautious when it came to spending. We always spent less than I made and saved our money. I knew that I would have savings and a cushion to get us through rainy days. And rainy days always come. The advice from Pop-pop is to save your money, and live beneath your means (spend less than you make.)
I left high school and joined the Navy before finishing my senior year. I bought and sold houses. I did investment banking deals. I bought and sold mortgages. Nana taught school to help pay tuitions. We were a team. In the end, I never cared that life wasn’t easy. I cared that life was good, and over the years life was very good. The advice from Pop-pop is to work hard, think long-term not short-term, and know that a good life is much better than an easy life. Easy never really makes you happy.
This Christmas I have set up the Richard R. Richards Grandchildren’s Trust. I deposited $10,000 in your name to be invested and available to you when you are 30 years old. Nana and I worked hard for this money and don’t want you to “blow it.” It is to be a “nest egg” for you to see you through rainy days after I’m gone. I hope you will use it to buy a house or educate one of my great-grandchildren. I hope it helps you, and I hope that you’ll feel good that Pop-pop and Nana loved you more than you’ll ever know and were determined to help you in your life.
Robert, you’ve made us so proud. I know that your future is bright, that success will come to you, and that the world is a better place because you are in it.
Merry Christmas! I LOVE YOU!!!
Among the many things we do for clients, contributing to a solution working on matters of this sort is very gratifying. Adding meaning to our clients’ lives adds a lot of meaning to our lives. It is the type of thoughtful relationship and problem solving that we believe is essential to proper client service and wealth management. Please let us know if there are any family/financial discussions with which we might be helpful.