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Keeping the money that could be coming your way

By Dian Vujovich

Rich or poor, we sure are goofy about our money. I mean, given the importance of the subject, it’s amazing how people can somehow forget about the money they’ve tucked away in retirement accounts. Or, are unable to keep the fortunes that their granny  has passed on to them going on  from their  generation to the next.


As important as saving hundreds of thousands—if not millions— of dollars for retirement is, recent LIMRA Secure Retirement Institute research found it wasn’t unusual for American’s who worked for companies that offered defined contribution (DC) retirement plans to walk away from their job and leave the money behind.


When that happens, those accounts are referred to as “orphan” accounts. Who knows why the employee chooses to do so but what’s kind of interesting is that the richer the employee, the more likely they were to have an orphan account.


According to the research, 44 percent of those with household assets of at least $500,000 or more were likely to walk leaving the account behind vs. 38 percent with less than that in household assets.


To any orphan account owner, I’d suggest they keep track of their money. No matter who is in charge of managing your wealth, there is no guarantee of how long it will grow—or last.


On that same who-knows-how-long-it-will-last note, Tom Rogerson, senior managing director and Family Wealth Strategist at Wilmington Trust, reminded me that there’s no guarantee even the uber-wealthy will have fortunes that last for generations.


“If you look at the studies, families that have build up significant wealth, Palm Beach-type wealth, will find their wealth is gone by the end of the 3rd generation,” said Rogerson who will be in Palm Beach this week.” And 70 percent of it is gone by the end of the 2nd generation.”


Ouch. Now that’s a big silver spoon bummer.


What’s the best way to insure your family’s wealth gets passed on? Rogerson says communication is key. And, that families have to learn to communicate trust and work together.


In other words, if your family wealth is managed by the one-man rule, can it. Instead, open up to your  fortune managed via a  teamwork approach.

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