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Your Take: The Gates and Buffetts’ Inheritances

I’ve read a lot about Bill Gates and Warren Buffett over the years and a factoid that surprised me as a younger man, but less so now, was that each planned on passing on “little” of their wealth to their children. Little is all relative, since both are worth many billions, but the idea that you wouldn’t pass on everything boggled my mind. As the years have passed, I realized that it makes more sense, in their case, if you didn’t pass everything on.

First, it’s an absurd amount of money. Bill Gates has said publicly [3] that he’s passing on $10 million to each of his children. $10 million is already a lot of money. It would take you 100 years at $100,000 a year to earn the same sum and $100,000 a year is nothing to sneeze at (let’s just ignore taxes to keep things simple, shall we?).

Second, when you get too much, you lose a bit of that hunger. You don’t know adversity. You don’t know what it’s like to have to think on your feet and be resourceful. Those are all skills that you need to learn in order to be successful and I’d really like to see the Gates kids do something special. They have the pedigree.

What do you think about inheritances in general? Or of the approach Gates and Buffett are taking?