Monica
💫 Summary
The video discusses the importance of creating a living trust and generational wealth, following the example of Rockefeller. By structuring a trust and utilizing compound interest, one can ensure the financial growth and security of future generations. It is crucial to involve a trust attorney and have open discussions with family members about the long-term plans for the trust.
✨ Highlights📊 Transcript
The speaker learned about the Rockefeller trust and decided to create a similar structure for generational wealth.
00:00
Studied the Rockefeller trust and read a book about it.
Decided to create a living trust to hand down real estate to future generations.
Structured the trust so that a percentage of properties would be sold upon passing, with the proceeds going into a brokerage account for grandchildren.
Immediate family would receive life insurance policies and main properties, while the brokerage account would be for the grandchildren's growth.
Grandchildren would receive the money in the brokerage account when they turn 21 years old.
Rockefeller's trust created generational wealth through compound interest and multiple trusts.
02:18
The initial trust turned into about 6.7 million dollars for great-grandchildren.
Each child opened a trust, resulting in grandchildren receiving payments twice, and great-grandchildren receiving payments three times.
The trust has been continuously paying out for 11 generations.
Rockefeller also had a life insurance policy on every person in the trust, creating his own bank.
To create generational wealth, it is important to set up a whole life insurance policy and a trust.
04:39
When leaving a life insurance policy to your family, consider the mortgage that needs to be paid off.
Get a term life insurance policy to cover the mortgage and put the remaining money in a brokerage account.
Start with a revocable trust and consult with an attorney to set up the trust structure.
The speaker discusses the use of a pour-over will attached to a trust, the frequency of meetings with a trust attorney, and the importance of updating the trust every three years.
07:01
A pour-over will is attached to the trust to include items not placed in the trust.
Meetings with the trust attorney were frequent initially, but later the trust was updated every three years.
Holding LLCs should be in the name of the trust, so that properties automatically fall into the trust in case of any unfortunate event.
To create generational wealth, it is important to have a letter of trust that explains the intentions and thought process behind the trust for future generations.
09:21
The letter of trust should be handwritten and include the creator's signature.
The purpose of the letter is to show future generations that they were thought of and considered in the creation of the trust.
Trusts can only be passed on to the last person alive in a generation, so it is necessary to restart the trust for the next generation.
It is crucial to have discussions with children and grandchildren about their interest in continuing the trust, as assuming they want to be landlords can lead to mistakes.
00:00yeah in 2019 my life changed
00:03buying real estate doing all these great
00:05things I understood the value of having
00:07uh real estate and wanting to hand it
00:09over to my legacy to create a legacy
00:11with that but once I actually went to
00:13create a living trust and I saw what it
00:16can do that's when I knew I had a bigger
00:19narrative I needed to share with the
00:21people so my thing was I looked at who
00:25traded a living trust to hand it down
00:27through their legacy and I said it's
00:29Rockefeller so I went on to read the
00:31Rockefeller trust from 1934 and also
00:34there's a a book called what were
00:35Rockefeller do so I stayed up reading
00:37all these things about how he would take
00:39this put it in an account and only give
00:41a portion to the Legacy and then have
00:44his children create a trust and now that
00:46money compound interest he wouldn't give
00:47it to him until they turned a certain
00:49age and I'm like
00:50I could do that we can do that the
00:53information was right there so I sat
00:54down with my trust attorney I said I
00:56want to do that like well you want to do
00:58it but I want to do that it can be done
01:00so we structured it worked it out where
01:03if uh not if but unfortunately we all
01:06pass away when I pass away a percentage
01:09of my properties would be sold not the
01:11ones that I hold long term like I have
01:13properties I do keep my short-term
01:16properties those would be sold that
01:18money would now go into a brokerage
01:20account that brokerage account would be
01:22in the name of the trust
01:24that money for that specific account
01:26would be for my grandchildren starting
01:28off not my immediate family my media
01:31family would get my life insurance
01:33policies which millions of dollars
01:35policies and the main properties that I
01:37hold so they're taken care of
01:39but we need to start thinking about the
01:41grandkids the great grandkids those
01:43Generations how do you start their
01:45growth you start their growth by putting
01:47that money in a brokerage account and
01:49they don't get that money until they
01:50turn 21 years old so let's use the
01:53example of a million dollars I put a
01:55million dollars in a brokerage account
01:56for my grandkids they don't get that
01:58till they turn 21 gaining six percent
01:59interest six percent interest they said
02:02as 21 so that money turns us to about
02:053.8 million dollars for my grandkids my
02:08grandkids they wouldn't get it all that
02:10we could have by 1.6 until I leave 1.6
02:13in there for my great grandchildren for
02:1521 years that now turns into about three
02:18four five six that turns into about 6.7
02:21million dollars for my great
02:23grandchildren they don't get it all they
02:25get half
02:26so now it's about one point one no about
02:302.2.3 2.3 stays in for my great great
02:34grandchildren
02:35so they get about 8.1 million dollars
02:37you see how that happens that's compound
02:40interest over 21 years
02:42so we have to look at that number but
02:44what makes the trigger and the explosion
02:46even bigger is the fact that what
02:48Rockefeller did is that was just his
02:50Trust
02:52what he did was now each children opened
02:55up each child opened up a trust so now
02:57his children had a trust so he would pay
02:59his grandchildren and his children would
03:01pay them that's twice so now his Grand
03:03his children then his grandchildren have
03:05a trust so his great-grandchildren would
03:07get paid three times so now if we look
03:09at Rockefeller trust paid out now 11
03:11generations and Counting continuously
03:14and what he also did was have a life
03:16insurance policy on every person in the
03:19trust creating his own bank
03:21and now what does that do this is my
03:23structure also any one of my children or
03:25grandchildren want to start a business
03:27what do they do talk to the trustees and
03:29now you borrow money
03:31we become our own bank
03:33so when someone dies that money goes
03:34into the trust you pay when you get the
03:36policy you pay it out right so now that
03:38money is available in the trust
03:40so now also what I did was I Retreat
03:42retweaked my trust last year and it was
03:4521 that I wouldn't give them money I
03:46changed it
03:47I changed the way to get money at 18 and
03:49they can have a business started at 11.
03:52you know why because now with technology
03:54kids are now figuring out new ways to
03:56start a business so I want them to be
03:58able to present a business loan a
04:01business proposal to the trustees so
04:03they could borrow money
04:04these are the things where we don't look
04:06at them when people say I don't have the
04:07money to do this you know what I tell
04:08them yes you do the air you breathe is
04:11money
04:12a life insurance policy as soon as you
04:15die you worth money they're generations
04:17and their groups of people when people
04:19die their objectives to make sure they
04:20have a policy on their grandmother
04:22policy on their father to do exactly
04:24what we're talking about but we look at
04:25this taboo when it can't be taboo it
04:28shouldn't be taboo the main thing about
04:30it is you're thinking about the Legacy
04:31and when I tell people when I speak to
04:33you I'm not speaking I'm speaking to you
04:34like this Legacy you're just a vessel
04:36for me to get the message to you so you
04:39can hear the message and see it and it
04:41reverberates in your brain and as it's
04:43doing this you literally are talking to
04:45your legacy while I'm speaking going I
04:47got you don't worry storm told me how to
04:50do it now I'm gonna give me a life
04:52insurance policy when people have a life
04:54insurance policy let's say roughly four
04:55million dollars you have half a million
04:57dollars left on your home mortgage and
04:59you say to yourself I'm leaving my
05:01family a million dollar actually you're
05:03not
05:04because when you die that policy has to
05:07pay half a million to the mortgage so
05:08they can stay in the house
05:09you're only leaving them half a million
05:11dollars we don't think about that
05:12mortgage behind us
05:13so this is where I say get yourself a
05:16whole life excuse me get yourself a term
05:18that's for a half a million or a million
05:21dollars just to cover the house so your
05:24real policy doesn't get broken up and
05:26now you have that term pay off the
05:28mortgage any money left put it in a
05:30brokerage account and now you start the
05:31system
05:33so let's stay on this conversation about
05:34the trust for a minute
05:36um so irrevocable life insurance trust
05:38or a revocable you start off as a
05:40revocable because you want to be able to
05:42say something and you can change it yes
05:44100 so you can all right so all right so
05:46who set this up for you your attorney
05:48yeah my statement you told them or they
05:50educ you educated them or they educated
05:52you obviously they're already educated
05:53because they're an attorney but it
05:55sounds like you kind of already had some
05:56idea of what you wanted to do because
05:57you did some reading before that yeah so
06:00what was the process you kind of said
06:01this is what I want to do and then they
06:04kind of added to it or they said this is
06:06what you should do
06:07um I came to them with my plan and my
06:08structure first and and I really wasn't
06:10taking no for an answer because I knew
06:12it could be done and there are some
06:14people that uh like there are mechanics
06:17who cars are broke like they just don't
06:19know fully how to do certain things so
06:22you really have to find the right person
06:24that does these things and I would
06:26always say speak to someone who has a
06:28trust speak to someone who you know they
06:30can refer you to someone but that takes
06:32time but they would give me little
06:35tidbits of well we can do this or
06:38they have a network of people and a law
06:40firm and they reach out to them like my
06:42First Trust cost me about twelve
06:44thousand dollars my newest One cost me
06:46roughly almost twenty thousand because I
06:48have a lot of things to fund it with but
06:51of starting out trust probably run you
06:53anywhere from three to six thousand
06:54dollars but you have to look at the big
06:56picture but I started out having a plan
06:58and I really really was adamant about
07:01getting this structure done that was it
07:03for me do you have a will too yo with
07:05the trust there's a thing called a poor
07:08over will that's attached to the trust
07:10for all the items that you don't put
07:11into the trust it automatically pulls
07:13over and fall into the will uh like
07:15jewelry like things that are heirlooms
07:18it'll automatically go in that well yeah
07:20I'm sitting here thinking obviously you
07:22will educate how often are you meeting
07:24with the trust attorney because I was
07:25having a conversation with a young lady
07:27the other day and she's finding it hard
07:29to have her parents you know even buy
07:31into the idea of a trust so how often
07:33did you meet with family if you did at
07:36all and how often did you meet with the
07:37trust attorney is that like a once a
07:39year thing or is it every six months
07:40because I'm sure you're acquiring
07:41properties and other assets throughout
07:44the year like how often is that
07:46happening uh in the beginning when I
07:47started we had to have a conversation
07:49literally it was about almost every
07:50other week sometimes every week to uh
07:53plan us out with insurance and all that
07:55stuff very complicated but once it was
07:57set the updating of the trusses every
08:00three years right but if there's
08:02something of urgency that I need to
08:04update because here's the thing and I'm
08:06going to throw this apart also I'm gonna
08:07drop it y'all pick this up when you're
08:10buying things in your holding company
08:11you're holding LLC should be in the name
08:14of your trust
08:15so if something happens to you the
08:18properties automatically
08:20fall into the trust
08:23automatically fall in there so you don't
08:25have to fund the trust because the
08:27trusts own the LLC so if let me give a
08:32quick example you know how you put your
08:34name on every single LLC you open up LLC
08:36you put your name on you open up y'all
08:38I'll see you put your name on it but if
08:39you was to have the property 123 Smith
08:42Street in its own LLC
08:44the name on that LLC
08:47would not be you it would be your trust
08:50so if something ever happens it
08:53automatically goes to the trust because
08:55you signed the trust over as the owner
08:57does that make sense automatically so
09:00with Trinkle effect so with that being
09:02said excuse me so with that being said
09:04you wouldn't have to fund one at a time
09:06you could just have that trust on it all
09:08these llc's bile straight in from your
09:11holding
09:12but uh also let me not glaze over
09:15something you said
09:16it's so important to have the
09:17conversation with your family and sit
09:19them down and explain because my thing
09:21was after everything's said and done my
09:24lawyer we would have the conversation
09:25with each one of them
09:27here's who's getting this who's the
09:29truck there's the trustee this is what's
09:31going to happen this is what it's
09:33supposed to be I want you to do this and
09:36it's a thing I'll call a letter of trust
09:37handwritten I want this copy of this
09:40letter in my hand written form and my
09:43signature should be copied for every
09:44generation every trustee so they can
09:46look and go he thought about me
09:49I want them to see
09:51what I meant and why I did this
09:54because that's powerful
09:56and they will get it and go man my great
09:58great grandfather thought about me
10:00so that letter you don't have to but the
10:04thing is always impact so you need to
10:06have that discussion with your kids your
10:08grandkids there's only so far trust can
10:11go it only could go to the last person
10:14alive in your generation
10:16up to a certain age so like if I have my
10:19my grandchildren my last one or my he
10:22would have to now take the trust format
10:24and restart it again and follow the same
10:27thing trust can't live on in infamy so
10:29you've created the generational wealth
10:31and the other part which is the
10:33sustainable wealth yep like that's the
10:35key right because it could get mixed up
10:36from Generation generation yeah but what
10:38you're doing is pretty much putting up
10:40the barriers like no we're going to
10:41sustain this forever forever the biggest
10:44biggest mistake that a lot of people
10:45make unfortunately
10:47when we have real estate is thinking
10:49that our children want to be landlords
10:51we can't we can't assume that they want
10:53to be landlords I had a a friend of mine
10:56who I knew through someone else he died
10:58didn't have a trust left the properties
11:00to his to his kids in a will they sold
11:04them because they didn't want nothing to
11:05do with real estate that's that
11:08destroyed me because I knew what his
11:10objective was so we need to put things
11:12in place to go okay if you don't want to
11:14be a landlord this is what we're going
11:15to do I'm gonna have a company do this
11:16or we gonna sell it put the properties
11:19in the brokerage account where it's
11:21gaining compound interest to do
11:23something so that's the key we need to
11:25stop you know really projecting our our
11:28wants and needs on children and
11:30grandkids when they're like yeah I got
11:31my own plan that's good that's good
11:35foreign
11:36[Music]
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FAQs about This YouTube Video

1. Why is creating a living trust important?

Creating a living trust is important because it allows individuals to ensure the financial growth and security of future generations, following the example of Rockefeller. By structuring a trust and utilizing compound interest, one can pass on generational wealth and provide for family members in the long term.

2. How can a trust attorney help with the creation of a living trust?

A trust attorney can provide crucial assistance in structuring a living trust by offering legal expertise, ensuring the trust complies with all relevant laws, and helping to avoid potential pitfalls. Their guidance is essential in implementing a trust that aligns with the long-term plans and goals of the individual or family.

3. Why is it crucial to involve family members in discussions about the living trust?

Involving family members in discussions about the living trust is crucial as it fosters transparency, builds trust, and ensures that everyone understands the long-term plans for the trust. Open communication can help mitigate potential conflicts and ensure that the trust serves its intended purpose for future generations.

4. How can compound interest contribute to the growth of a living trust?

Compound interest can significantly contribute to the growth of a living trust by allowing the trust to accumulate wealth over time. Through strategic investment and reinvestment, the trust can harness the power of compounding, leading to substantial financial growth and security for the beneficiaries in future generations.

5. What are the key elements of structuring a living trust for generational wealth?

The key elements of structuring a living trust for generational wealth include involving a trust attorney, utilizing compound interest for financial growth, and having open discussions with family members about long-term plans. By incorporating these elements, individuals can establish a solid foundation for passing on wealth and ensuring the security of future generations.

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