Transcripts

Money File-It's Not The Size of The Estate

SUSIE GHARIB: In the money file tonight, they say you can`t take it with you. So Chuck Jaffe, senior columnist at Marketwatch, says if that`s the case, you should plan now, while you still have control as to where you want your money to go.

CHUCK JAFFE, SENIOR COLUMNIST, MARKETWATCH: Last month, Bill Gates and Warren Buffett both announced plans to give away billions of dollars to charity. You can`t do that; you don`t have the money. But you can make sure that your fortune, such as it is, has a lasting effect not only on your loved ones, but for the causes and organizations that you hold dear. Gates and Buffett both followed an unusual script in that most people pass the vast majority of their net wealth on to loved ones, and then they make the charitable causes something of an afterthought.

Of course, as billionaires, they could set up their families in style for a pittance of the value of their estates. But in keeping everything equal and equitable with the children, they also eliminated a lot of the possibility that their heirs would wage the kind of ugly money-grabbing fight that destroys many wealthy families. They also ended that kind of battle before it could ever start, a maneuver that will help maintain family harmony for decades.

The lesson ordinary folk should learn from Gates and Buffett`s generosity is that the size of the estate doesn`t matter as much as what you do with it. If you have a need for estate planning, you want to do it not only to protect and help your loved ones, but also to protect and provide a legacy that helps others. Charitable groups don`t expect to get a fortune like that of Gates or Buffett and most don`t need it. They can take your smaller donations and make great things happen if only you give them that chance. I`m Chuck Jaffe.