A long time ago, one of my tenants who drove a Range Rover told me, “I need an extra day to pay rent in order to withdraw money from my trust fund. Can you wait?”
I thought to myself, you knew today was move-in day when rent would be due, couldn’t you have planned ahead? This is not how a new tenant / landlord relationship should start.
“OK, please send in your portion of the rent the following day,” I responded, trying to hide my annoyance. This was the first time anybody ever admitted to having a trust fund. Why was I taking the credit risk when his roommates could have covered for him? Did he really not have an extra couple thousand dollars in his bank to honor our agreement given he drives a $50,000+ car? Was he lying on the rental application when he said he has $20,000 – $30,000 in liquid savings? What the F is going on?
The next morning, his father’s assistant e-mailed me asking how she could deliver the rent for my tenant: Fed Ex or wire? Wow, talk about having everything done for you. At least I got paid by the Bank of Mom & Dad.
This little episode reminded me the world is never going to be fair. There will be people who work their asses off, say all the right things, and still won’t get ahead because they don’t have the finances or connections like the rich.
The rental situation for my place was highly competitive. Had I known my tardy tenant had a trust fund, perhaps I would have rented out the place to someone else who wanted the place just as much, but whose financials were all her own. In the past, I’ve rented an apartment out for way below market because the tenant was a middle school teacher. They get paid way too little for what they do.
As a way to help make the world more equal, I’d like to introduce The Trust Fund And Inheritance Identification Program.
THE WEALTH IDENTIFICATION PROGRAM
Under the trust fund and inheritance ID program, the government would make public record all those people who have trust funds and received inheritance amounts over a certain level. Given the national average inheritance amount in the US is around $180,000, those who receive inheritance amounts over 50% of the average will get identified, for example. Let’s put that figure at an easy to remember $300,000.
We could have a tiered identification process where those who inherit or have trust funds of $300,000 – $500,000 get marked in Blue, those who receive $501,000 – $1,000,000 get marked in Green, and those who receive more than $1,000,000 get marked in Purple.
With the trust fund and inheritance program, friends, colleagues, landlords, and employers can better differentiate between people who are struggling and people who’ve got it made for just being born wealthy. People can therefore make more informed decisions on who should get promotions, raises, scholarships, a coveted apartment, and general government assistance.
Example Of Who To Help Based On “The Program”
Candidate #1: Jocelyn is 27 years old and is worth $2.5 million dollars because her parents created a $2.4 million trust fund for her when she was 12 years old. Jocelyn was able to accumulate $100,000 in net worth on her own because she didn’t have to pay for her $50,000 a year tuition at Boston University, nor did she have to pay rent for living in her parents pied a terre they bought for her to use. Jocelyn is a nice woman who has been working for Google for five years. She got the job through her parent’s connections because Google doesn’t recruit from Boston University.
Candidate #2: Fred is 27 years old and is still worth $0 because he had to put himself through school, pay off $40,000 in student loans, and live with three other roommates to afford his $1,400 a month room. Tuition at UC Berkeley for in-state students costs $13,000 a year. He wanted to go to Harvard, but after financial aid, he’d still have to pay $20,000 a year in tuition alone. Fred worked multiple jobs in college, but was also able to land his dream job as a data engineer at Google upon graduation. Fred is a good person and has a strong work ethic just like Jocelyn. But Fred is helping take care of his single mother who still works as a maid at a hotel, while Jocelyn’s parents are vacationing in one of their vacation homes in St. Bart’s.
Through the The Program, a Google manager can be much more confident and feel less guilty about promoting Fred over Jocelyn because of their two extremely different financial situations. If Joceyln doesn’t get promoted, the major will feel less guilty because she’s still worth $2.5 million. When her parents die, Jocelyn stands to inherit another $2.5 million.
If Fred doesn’t get a raise and a promotion, it might mean the difference between losing Fred to another employer who will pay him much more since engineers are in huge demand. Fred will have a higher propensity to take another offer because money is that much more important to him given his family’s situation. One can assume that Fred might also appreciate the raise and promotion much more than Joceyln. The best bet is for the Google manager to promote Fred so that he’ll not only stay with Google over the long term, he’ll be able to better take care of his mother.
HELPING THE LESS FORTUNATE IS WHAT THE PROGRAM IS ALL ABOUT
Everybody is born with a different set of circumstances. I play tennis with members at my club whose children will all be set for life. I’m sure they’re all great kids, but what about the great kids who grow up in broken homes? Poverty is an extremely difficult situation to escape, no matter how much we say that education is the key to wealth.
By identifying life’s lottery winners, college administrators, managers, and business leaders can help the less fortunate get ahead. The Program might be very difficult to pass given the people who run our country predominantly are wealthy and powerful people whose kids will be negatively affected by the program at the margin.
Let’s say it takes Joceyln one more year to get promoted and receive that $20,000 raise at Google. That’s disappointing, especially if she feels she’s highly qualified. However, does it really matter to Joceyln in the grand scheme of things given she’s already worth $2.5 million? Joceyln knows Fred hasn’t been tagged by The Program, hence once she realizes Fred gets promoted over her, will she really be pissed? If I was in her shoes, I’d be disappointed, but happy that Fred could catch up, even just a little bit.
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Updated for 2017 and beyond.