What is an Endowment?

I did a presentation and book signing at Freedom Theatre sponsored by African Tropic Decor Gallery, Inc. It was a wonderful evening. The art on display was uniquely fantastic.

Well, we had lots of questions which I enjoy the most when I do these presentations. I share one with you here. What is an Endowment? First, an endowment is not a bequest which is a gift left in a will. Note, a bequest could go towards an endowment. An endowment is not a trust which serves a specific purpose and generally can hold a variety of assets.

An endowment is a fund established generally with money, but can include real estate and other assets, to benefit an institution or person. It has a specific purpose and the money in the fund is to be applied for that purpose. In an endowment fund, the principal is invested, and only a portion of the investment earnings, income, is spent. The rest of the earnings are directed back into the fund, so that the endowment grows over time. In this manner, the endowment becomes a perpetual source of funding for whatever the person making the donation wishes to achieve.

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Wills of the Rich and Famous

There are lessons for all of us in the planning or failure to plan of the rich and famous. I thought I would spend a few days looking at some rich and famous, contemporary and historical figures. What did they do right or wrong in their planning? Hindsight of course is 20/20 so let it work for our estate planning.

Last night as I was looking at Jeopardy this post came to mind. The question was "At his death in 1790, he left 200 year trust funds to the cities of Boston, MA and Philadelphia, PA?" Do you know the answer? It was Benjamin Franklin.

Franklin decided to leave funds to his native Boston and his adopted Philadelphia, on the condition that it be placed in a fund that would gather interest over a period of 200 years. Franklin's Philadelphia trust was used for a variety of loan programs to local residents. The money was used mostly for mortgage loans. When the trust came due, Philadelphia decided to spend it on scholarships for local high school students. Franklin's Boston trust fund was used to establish a trade school that, over time, became the Franklin Institute of Boston.

In this case, Franklin invested a small amount that accumulated a lot over a long period of time and made a difference in the lives of countless individuals. Rich or famous, a little or a lot, let us help you plan TODAY for tomorrow. Leave your comments here or contact us at www.ythlaw.com

Generational Wealth

I was listening to an entertainer recently commenting about his neighborhood. He said there are a few other wealthy entertainers living in his area. However, this neighborhood of multi-million dollar homes included many people who do not have multi-million dollar salaries.

This is where generational wealth is an advantage. It is not about what the individual makes. It is about access to wealth and to other sources of assets. Generational wealth is about trust funds, inheritance, gifting and other estate planning techniques. In order for one generation to help another generation, there has to be planning done. It can not be done in a choatic way or at the last minute if your intent is to make a positive financial difference for the next generation.

Whether expensive homes, exotic travels, charitable endeavors or other opportunities are of interest to your heirs, you can make it all possible in a way that is most productive and beneficial to those you love. Let's talk about what your plans might be soon. Call for a free consultation.