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When you draw on a memory, you always do so from the perspective of your present self. Psychologists call memory a “reconstruction,” because it is always reconstructed based on your present views, which influence how you see and perceive past events.14,15,16 As Oliver Wendell Holmes, Jr., stated, “A mind that is stretched by a new experience can never go back to its old dimensions.
If you look at the estate planning industry today, the basic strategy begins with identifying the number of heirs. Why? To divide the estate up amongst as many heirs as possible, utilizing all the gift and transfer techniques. One of the first rules of war is to “divide and conquer.” And so, if I'm dividing the assets up, I'm setting that family up for failure. Our findings show that in all too many situations, traditional planning has done more to destroy families than taxes will ever do. Traditional estate planning operates around the four D's: Divide the assets, defer those assets downstream as far as possible, then dump them on what most times are the ill-prepared heirs, and watch those ultimately dissipate. It's been said that only two percent of family wealth ever makes it past the third generation. So I think that's all you need to know about the effectiveness of traditional estate planning.