Building generational wealth isn\u2019t about affording high status purchases, it\u2019s about consistency, structure and foresight. Financial experts say that the people quietly setting up their families for long-term security are often doing it through patient habits and smart planning, not showy success.<\/p>\n
Here are six signs that you\u2019re building generational wealth steadily and quietly<\/a>.<\/p>\n \u201cOne of the clearest indicators that someone is building generational wealth is their commitment to consistently saving and investing<\/a> a percentage of their income, regardless of economic conditions or income fluctuations,\u201d said Chad Harmer, founder of Harmer Wealth Management<\/a>.<\/p>\n A disciplined and strategic approach, maintained even during challenging periods, builds substantial wealth over time.<\/p>\n Lawrence Gore, senior vice president at Tompkins Financial Advisors<\/a>, agreed: \u201cConsistent savings and investing improve the ability to meet long-term wealth creation goals \u2026 given tax-efficient and long-term compounding opportunities.\u201d<\/p>\n Find Out: The No. 1 Way Americans Become Millionaires Is Pretty Boring \u2014 and Easy To Do<\/a><\/p>\n Read Next: 6 Subtly Genius Moves All Wealthy People Make With Their Money<\/a><\/p>\n Wealth that lasts beyond one lifetime is rarely built on cash alone, however.<\/p>\n \u201cLong-term wealth creation is usually a combination of investment strategies,\u201d Gore said. In addition to traditional investing, people who benefit from long-term appreciation of real estate or a growing valuation of a business, or assets such as art can all contribute to generational growth, he added.<\/p>\n Those quietly building generational wealth tend to plan several steps ahead<\/a>. They work with advisors to design tax-efficient strategies and legacy plans rather than simply focusing on short-term returns.<\/p>\n Truly building generational wealth in the most effective way possible requires a blueprint and forethought, according to Stephen J. Landersman, CFP, president of Unifi Advisors LLC<\/a>. \u201cIn order to preserve what you have, protect it from the dangers of income tax, market forces and litigation, and finally pass it on to heirs \u2026 you will need to take advantage of all the tools available to you.\u201d<\/p>\n He said that you must think with the end in mind. \u201cWhat\u2019s the vision of the legacy they want to leave for their family and their community? Without that you\u2019re just guessing what will happen.\u201d<\/p>\n Protecting wealth across generations also involves careful risk management and preparing heirs to handle their inheritance wisely.<\/p>\n Insurance, estate planning and financial literacy \u201care key to educating and transitioning wealth to the next generation,\u201d Gore said. He stressed that \u201cfinancial literacy is a critical element in educating the next generation \u2026 and provides a higher probability of asset preservation over the long term.\u201d<\/p>\n Insurance plays an especially key role in preserving wealth, Gore noted, and your insurance needs can change over time. \u201c[H]aving the ability to backstop high-income earners, create liquidity upon an untimely passing and fund trusts for future needs are all key reasons to have insurance in place.\u201d<\/p>\n These tools can protect wealth from taxes and litigation while ensuring it\u2019s distributed efficiently and intentionally.<\/p>\n Those truly focused on legacy think beyond their own retirement. They set up vehicles to support children and grandchildren<\/a>, sometimes in ways that aren\u2019t immediately visible.<\/p>\n \u201cThere are many available tools for parents and grandparents to support future generations,\u201d Gore said, citing \u201ccustodial accounts, 529 plans to support educational needs, setting up educational trusts as well as trust planning to provide future funding.\u201d<\/p>\n Generational wealth requires check-ins and recalibration. People building lasting wealth understand that their finances should evolve with their goals and circumstances.<\/p>\n \u201cPeople should have a periodic check-up on their finances, i.e. assets, liabilities, income and expenses,\u201d Gore said. \u201cEssentially, having and updating a financial plan, allows people to monitor progress, make necessary changes and plan for the future.\u201d<\/p>\n True wealth builders often don\u2019t look rich. They prioritize funding retirement plans, education and building lasting assets instead of chasing status symbols.<\/p>\n More From GOBankingRates<\/p>\n This article originally appeared on GOBankingRates.com<\/a>: 6 Key Signs You\u2019re Quietly Building Generational Wealth<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Building generational wealth isn\u2019t about affording high status purchases, it\u2019s about consistency, structure and foresight. 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