May is Asian American and Pacific Islander Heritage Month, College Savings Month and my birthday month! Besides making hotpot to celebrate, I also want to celebrate by talking the intersection of all of the topics - our legacy and 529 plans. Here are the TLDRs:
Rethink Legacy First-generation wealth builders and immigrants often feel pressured to leave a tangible legacy. However, it's essential to recognize that a legacy can be more than material wealth, including the values, mentality, and mindset passed down. Balancing the present and future is crucial, and it's important to embrace the softer aspects of our legacy.
529 - What they are and are not 529 plans are tax-advantaged investments for education expenses, offering flexibility and control. Common misconceptions include limited usage, state investment restrictions, major financial aid impact, and losing funds if the beneficiary doesn't attend college.
April and May are busy here in a good way. Tax season is finally over and we celebrated with our new family tradition of going to Disney with extended family. This vacation was closely followed by the Jolt conference. Thankfully, I have no further travel plans for the next couple of months.
On a different note, I’m thrilled to share that I recently completed my "Building the Behavioral Advisor" certification. This intensive 4-month program, offered by none other than Shaping Wealth, delved into the research and practices for attaining "Funded Contentment". I was fortunate to be the scholarship recipient for this session. I'm incredibly thankful for the kindness of Brian Portnoy, the founder of Shaping Wealth, and the exceptional experience that BTBA provided. I’m excited to apply what I learned at BTBA in my daily interaction with clients and prospects and help my clients achieve: "An inspired life driven by values, not money".
Rethink Legacy
In 2014, when I purchased my first house, my mom felt an overwhelming sense of guilt because she couldn't contribute to my down payment. Despite my husband (then-boyfriend) and I being more than capable of covering the cost, she couldn't shake the feeling that she had failed as a mother.
To some, her assumption of responsibility might seem surprising, as adult children in American society typically take care of their own affairs. However, cultural nuances play a significant role in how we shape our expectations. You see, the love of older Asian parents often manifests through tangible and practical actions, like a bowl of peeled and cut fruit, providing a house down payment, or providing childcare when needed. In China, parents often view helping with a down payment as an expression of love, not just financial support. In return, children are expected to care for their parents in their later years, adhering to the cultural concept of "filial piety." This care can take various forms, but it ultimately represents financial support for one's parents. Recently, articles like the New York Times' "Their Children Are Their Retirement Plans" finally shed light on this issue and brought it to the mainstream consciousness.
My perspective with the down payment debacle couldn't have been more different from my mom's. My mom has already given me so much. She paid for my graduate school tuition in full, even when she faced severe financial struggles. Beyond that, she devoted herself to caring for my grandparents before they passed away. Considering her limited resources growing up and her hardships later in life, she has achieved a great deal as a first-generation wealth builder. Yet, she still feels unaccomplished because she unfairly compares herself to others with more resources and connections.
his situation has led me to reflect on the expectations we set for ourselves regarding our legacy. Many of my clients, especially first-generation wealth builders and/or immigrants, often discuss this topic. They talk about the pressure to help their families reach the same level of success they have – caring for the elderly, raising their children to higher standards than they experienced, and continuously giving to the rest of the family.
My clients often talk about what they want to leave to their offspring as a legacy, sometimes putting undue pressure on themselves. Life as a "sandwich" first-gen wealth builder is already challenging enough. If we can leave something for our children when our time comes, that would be fantastic. But for most people I speak with, even if they don't achieve that goal, they've already done so much. A legacy doesn't have to be solely tangible and practical, like the expression of love we received. It can also be intangible and abstract.
Building first-generation wealth and leaving a tangible legacy on top of that is commendable, and it's wonderful if you can achieve it. However, if it means sacrificing the present for the future, finding a balance is crucial.
So, let's embrace the softer aspects of our legacy and not be too hard on ourselves if we feel like we're not building "generational wealth", especially for first-generation wealth builders and immigrants. Our legacy can be more than just money or a beach house; it can include the values, mentality, and mindset we pass on to our children. By overcoming everything that’s worked against you so far, you have already been creating a legacy beyond material wealth.
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