Rich man, poor man

“The man who dies thus rich, dies disgraced.”

This controversial quote came from Andrew Carnegie who is known as the father of modern philanthropy.

Carnegie, who was born in 1835 and died in 1919, was among the wealthiest and most famous industrialists of his day. Born of humble beginnings in Scotland, Andrew’s parents – together with their two sons – migrated to the United States. By age 30, Andrew had amassed business interests in iron works, steamers, railroads and oil wells, later building Carnegie Steel Corp. to become the largest steel manufacturing company in the world.

His philantrophic career, according to carnegie.org, began around 1870, supporting myriad projects and causes, most known of which is his gifts of free public library buildings. He later married Louise Whitefield and signed a prenuptial marriage agreement stating that he intends to give away virtually his entire fortune during his lifetime.

He wrote “The Gospel of Wealth,” which articulated his view of the rich as trustees of their wealth, who should live without extravagance, provide moderately for their families, and use their riches to promote the welfare and happiness of others.

Andrew established Carnegie Corp. of New York, which he endowed in perpetuity with his remaining fortune of $135 million to be used principally to promote education and international peace. The $30 million he was not able to give away before died also went to the corporation’s endowment.

Fast forward to today.

A number of rich people are trying to follow Andrew’s example and have said that they are not planning to keep their riches in the family.

Ted Turner, CNN founder, has joined Microsoft’s Bill Gates and Warren Buffett’s philanthropic The Giving Pledge, a campaign to encourage extremely wealthy people to contribute most of their wealth to philantrophic causes, and which signed up about 40 billionaires. Turner’s children will not inherit his vast fortune.

Star Wars creator George Lucas has also announced that a major part of his wealth would go to educational philantrophy and half of his fortune to charity.

Laureen Powell Jobs, who inherited billions of dollars after the death of her husband Apple founder Steve Jobs, is dedicating her life to giving away Steve’s wealth, saying she does not believe in the accumulation of wealth.

Meanwhile, Warren Buffet, whose net worth is estimated at $100.8 billion, has said that he wants to give his children just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing. He has pledged to give more than 99 percent of his wealth to charity. His children will have have a $2 billion foundation funded by their father.

Bill Gates who together with his wife, Melinda, have a net worth of around $133.2 billion are said to be planning to leave $10 million for each of their children and nothing more. In the same article by Style, Gates was quoted as saying that leaving kids massive amounts of money is not a favor to them and distorts anything they might do to create their own path.

Likewise, Facebook founder Mark Zuckerberg had announced in an open letter that he and his wife would give away 99 percent of their company shares over the course of their lifetime to a foundation.

The same article mentioned that actor Daniel Craig, who is said to be worth $160 million, thinks that inheritance is quite distasteful. Canadian entrepreneur Kevin O-Leary, worth $400 million, for his part wants his children to acquire a work ethic and does not plan to leave an inheritance to them.

Actor Jackie Chan, who has amassed a $130 million fortune, plans to donate his entire wealth to charity instead of leaving it to his only son. In explaining why he will not pass his fortune to his son, Channel News Asia quoted the actor as saying: “If he is capable, he can make his own money. If he is not, then he will just be wasting my money.”

British musician Sting, who has a net worth of $400 million, has also announced that he is not leaving any cash to his six children. Elton John and his husband David Furnish, who have a combined net worth of $550 million, have said that it is terrible to give kids a silver spoon since it will just ruin their lives.

TV personality and producer Simon Cowell (net worth $600 million) said he is going to leave his money to charity, but not to his son, explaining he does not believe in transferring funds from generation to generation. “Your legacy has to be that hopefully you gave enough people and opportunity so that they could do well.”

Rock legend Gene Simmons says he wants to do what every bird does in its nest – force the kids to go out there and figure it out for themselves, while composer Andrew Lloyd Webber likewise does not plan to turn over his $1.2 billion fortune to his kids, saying he wants his family to learn the importance of working. When children suddenly find a lot of money coming their way, they have no incentive to work, he said.

But whether you are planning to leave your estate to charity or to your children, never leave this world without a plan. Leaving the settlement of your estate to the courts will most likely turn into a bloody mess.

When a person dies without a valid will, his or her property passes to his/her heirs via intestate succession. If the decedent left no will and no debts, and the heirs are all of the age, then the parties, without securing letters of administration, can divide the estate among themselves as they see fit by means of a public instrument filed in the office of the Register of Deeds, and subject to compliance with other requirements, including publication. But the estate taxes have to be paid first before filing the deed of extrajudicial settlement.

If the decedent left no will, then there is a process called judicial settlement of the estate of the deceased. How the estate will be distributed by the court-appointed administrator will depend on what is called an order of intestate succession where the legally adopted child succeeds to the property of the adopting parents in the same manner as a legitimate child, meaning equal shares. An illegitimate child inherits one-half the share of a legitimate child. So whether legitimate, adopted or illegitimate, but provided that their filiation is proven, all are compulsory heirs who are entitled to a part of the testator’s estate.

It is always preferred that a person plans his estate properly while one is alive – whether it be making a will, placing his assets in trust or donating to charity. That way, no family relationships are destroyed and his or her wishes are followed.

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