THE IMPORTANCE OF FAMILY FINANCIAL STRUCTURES
In the United States, families such as the Rockefellers, Waltons, Kochs, Marses and Mellons have created solid financial structures that guarantee the perpetuity of assets, protecting future generations. The Dynasty Trust, for example, started by the Rockefeller family in 1870, is a tool that ensures that the wealth of around 400 billion dollars built over more than 150 years remains protected and beyond the reach of conflicts between heirs, divorces and other legal obstacles.
Rockefeller family in the 19th decade and the generation of the 21st decade.
In Brazil, it is common to see the concentration of assets in real estate and family businesses. This model, although safe in the short term, can lead to liquidity problems and difficulties in managing inheritances, especially in cases of family conflicts. The lack of a solid and planned financial structure can result in the dilapidation of assets over generations.
The American model offers several benefits. Dynasty Trusts protect assets from litigation, ensuring that assets continue to grow and benefit future generations. These structures also allow for greater flexibility and liquidity, making it easier to access funds when needed and providing efficient asset management. In addition, they can offer tax advantages, helping to protect assets from high taxes.
The chart above illustrates the wealth growth of a Dynasty Trust over five generations, starting with an initial wealth of $1,000,000. With an average annual growth of 5%, the wealth value increases exponentially, reaching $243,000,000 after 100 years.
Life insurance is a powerful tool when combined with a Dynasty Trust. It provides immediate and long-term benefits, ensuring financial stability and protecting family assets. Life insurance proceeds can be designated to fund the Dynasty Trust, ensuring that heirs receive a significant financial benefit without facing high inheritance taxes.
RC Patrimonial can help you create a solid and permanent financial structure based on the principles of asset perpetuity. With our expert advice, you can ensure that your assets are protected and that future generations can benefit from your efforts. Contact us to find out how we can help transform your financial planning.
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