Building Capital For More – Watering The Seeds of Generational Wealth

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Building generational wealth for family and future offspring sits at the root of many people’s financial goals list. Nevertheless, as it lies at the source, watering its seed toward fruition always tends to fall behind the “now” issues of life. Whether those issues or milestones are getting out of debt, saving money, or finishing up school to get that career going, taking that first action toward investing in your family’s financial legacy remains on hold.

When asked, “how do you build generational wealth,” you will hear replies like invest in stock or real estate. While these are true, there is a significant crucial step that must be recognized and implemented before, and that’s building capital.

Now when I say building capital, I don’t mean just saving money for the sake of just saving or saving for a rainy day. The main difference between savings and capital is purpose. Being said, it is necessary to have both, to become financially stable. When we choose to build capital, we are choosing to work and develop a monetary value for the single purpose and expectation for return on investment (ROI) or what I like to call “more.”

I like to use the term “more” because it allows the mindset to view its destination as endless possibilities while still being in the scope of its rooted purpose – to gain an increased ROI to water the seeds of generational wealth.

To be clear, the “more” is NOT:

• A trip to next year’s vacation
• The funding of the retirement destination spot from your bucket’s list
• The funding for that dream boat or car you’ve been eyeing your entire career
• Your 6 months emergency fund
• Paying off your debt
• Anything that will not accumulate and keep accumulating monetary value

Essentially, your “more” are assets that will grow and be passed down through the generations. When just being introduced to the concept of generational wealth, a person needs more than the list of suggested “assets” where they should invest their capital. They should also be introduced to the truth behind knowing how to create the capital.

Your roadmap toward creating capital for your “more.”

1) Strategize your journey

A strategy is always the most reliable approach toward getting anything you want in life. It would be best to have a plan that will include knowing your first capital amount milestone and ensuring that amount will impact transformation or growth when it is watered on your generational wealth seeds.

For example, let’s look at investing in real estate. For beginners, very few have enough capital to invest in a rental property. Alternatives may be REIT (Real Estate Investment Trusts) or online real estate investment platforms such as Fundrise or RealtyMogul. If this is your first approach toward watering your generational wealth seeds, research the minimum amount of money needed to open an account and how much you would have to regularly contribute. Establish your number and set that as your capital amount goal.  Now you have a baseline foundation for your “more” that will provide an appropriate ROI.

2) Establish a bank account dedicated to your generational wealth seed capital

It’s so important to intentionally separate your generational wealth seed capital from your other financial accounts. If you have a financial advisor, they all recommend having an account for each financial goal or intention. Give your generational wealth seed capital the same respect as your 6-month emergency fund. As I said, I’m not a financial advisor but have had a few advisors in the past to assist me on my journey. Find an account that provides higher interest earnings without withdrawal penalties. The goal is to use the seed money when the opportunity arises (like contributing to Fundrise). Do some research and take invested time in finding one that works for you.

3) Start freelancing or build a small business

The best way to generate capital for your financial goals and your generational wealth is to do freelancing or start a small business selling digital goods. Doing freelance work involves providing direct solution-based value for someone’s problem in exchange for monetary value. I choose to break freelancing down in this manner because folks place too much hype and pressure around freelancing. Consequently, the external drama causes an internal tension, resulting in aspiring freelancers to take it too “personal” rather than what it is – an exchange of value. Small businesses can include freelancing and selling digital products online, substantially expanding itself into an eCommerce business.

If you are on the fence or not sure how to get started on freelancing, use platforms like Fiverr or Upwork to get you started so that you can concentrate on your craft rather than the business. Once you feel comfortable marketing yourself, having clients, and servicing orders, begin selling from your own website. Like Fiverr, many of these platforms allow customers to leave reviews from their experiences while working with you. Take those reviews and add them to your personal website.

Remember that all proceeds from these endeavors must be placed into your account set for watering your generational wealth seeds. If you have other financial goals recommended by your financial advisor, dedicate the proceeds of certain digital products or freelance services exclusively for your generational wealth capital.

4) Establish an LLC (Limited-liability Corporation) for your endeavors.

It is NOT enough to get an Employer Identification Number (EIN) and go from there. Do yourself a favor and file for an LLC to protect your personal assets and receive all possible tax deductions for business owners. You can also write-off your business expenses AND a percentage of your home as well as utility bills if you have a dedicated room for your business. By simply adding your income without an LLC, you are allowing Uncle Sam to take a large percentage of your hard-earned money, just as he does for your 9-5 income – not cool.

The key to generational wealth and passing on its assets is legally keeping every single dime possible.  It doesn’t take much to file for an LLC in your state, as well as a business license. Do this and get those deductions!

5) Stay hungry and prosper!

Building generational wealth is no easy task, but who cares? Just do it! I’m not here to feed into the emotions of I can’t, or it’s too much. Listen, if you are focusing on generational wealth, that is because chances are, no one did it for you. Generational wealth should have been seeded before you, but that’s ok – you’re doing it now for the next offspring. Be the goat of your generation. You will have to build a business providing services or selling digital products while having a 9-5 job – but that’s ok too. It’s hard, yes, but it is worth the assets your offspring will have, giving them a head start to build for their family.

Join the Conversation!

If you’re already along in your journey toward watering your generational wealth seeds, let us know about it in our tribe group. Tag #MTLGenerationalWealth, so I’ll know it’s on this conversation.

I would love to hear about it, and it could give someone the necessary motivation they need to get started on their journey!

Financial and legal Disclaimer:
The content is for informational purposes only as I am not a legal financial advisor. I’m only sharing from my own personal experiences. Although my opinion may highlight great opportunity, you should always consult a legal financial advisor for your circumstance. You should not construe any such information or other material as legal, tax, investment, financial, or other advice.