TRANSKRYPCJA 🔗
Dan Pascone: I'm Dan Pascon, CEO of Tailored Wealth and host of the Making Sense of Your Money podcast, where every conversation is built around one idea. Your money is a tool to design and live your version of a rich life. A lot of high earners have checked the boxes, the will, the trust, the beneficiary designations. But here's the thing, a trust tells your family where the money goes. It doesn't tell them why. And for most families, that gap is exactly where generational wealth falls apart. Not in a bad market, but at the dinner table. Today I'm joined by Ashish Khanna, a recovering attorney turned partner at Hightower Signature Wealth, who advises high net worth families on estate, tax, and legacy planning. But what sets Ashish apart is where he starts. Not with the balance sheet, but with the family. We're getting into why 95 % of generational wealth failure is a human problem. why your estate documents may be legally airtight, but relationally empty, and what it actually takes to pass down the mindset, not just the money. Before we get into it, make sure you're subscribed on your favorite platform. And if the show is adding value for you, I'd really appreciate a quick review. It goes a long way. Thanks and enjoy the episode. ⁓ Welcome to another edition of the Making Sense of Your Money podcast, where we cut through the financial noise and help business leaders to make smart, competent money decisions. Ashish, thanks for joining today. Really excited to have you on Making Sense of Your Money. Thanks for coming on. Thank you for having me, Dan, fan of the show. Yeah, appreciate it. Appreciate it. I'm excited about this discussion. I think you've got a really unique take on ⁓ personal wealth. legacy planning, a lot of different aspects. And I'm really excited to kind of unpack your process and how you help people do what you do. But if you don't mind, share a little bit about what you do with our audience and maybe give us a little bit of background on how you got into your space. Perfect. Yeah. A little background about myself. I tell people I'm a recovering attorney. I used to practice. Practiced it for a while, but realized that wasn't my ultimate calling. Really wanted to be a more of a trusted advisor that had kind of tentacles all over my clients' financial wellbeing. And that's what ultimately led me to the wealth management space that I've been in over a decade. My partner at Hightower Signature Wealth. We have offices throughout the country. I'm located in Dallas and really honestly love what I do. Very, very cool. All right. So. I love hearing from recovering attorneys. Those are always the best ones for me. What prompted you to make that transition? And I know you deal with a lot of stuff today. Um, when you're talking about legacy planning, we'll, we'll impact that a bit. Um, you know, probably your experience, your expertise, some of the things you learned from being an attorney relate to what you do today, but what ultimately from a career perspective made that transition make sense for you? Yeah, I would say there's. two kind of seminal moments that helped with that transition. The first one was my mentor partner when I was at a large law firm. And I remember going into her office and asking her when she knew this was what she wanted to do the rest of her career. And she just blankly stared at me and said, sheesh, there's not a day that goes by where I'm like, what am I doing? She's like, you have a small window to get out, right? Where in terms of You build a certain lifestyle by being at a large law firm that if you don't see yourself sitting here 10 years from now, 20 years from 30 years from now, you have a small window to get out. So I saw kind of the partner's lifestyles and you know, I was hoping one day to have a family and have, have more of a balanced lifestyle and just didn't see that. Right. And so that was a great, honest conversation that she had with me. And then the second, when I was practicing in estate planning as an attorney, I had a client, you know, they came to me, they had three small children and the husband got really sick. And I remember that phone call at 11 PM at night from the frantic wife just scared out of her mind, you know, and all I had done for them was their will, you know, and their powers of attorneys and basic things. But question with her crying was like, are we going to be okay? And I honestly couldn't answer that. was like, well, I know how your assets go. I know who's in charge of this, but I really had no deep understanding to be able to answer that in the affirmative or say, well, here's what we've got to do to make this right. And that's what made me realize, okay, I need to, I need to get more involved. Right. So if I ever do have that type of call or those concerns, I feel pretty confident now where I can give a solid answer. Super interesting because we're going to get into this. You know, our purpose is to help our clients to live their version of a rich life. And we're going to talk about what that means to you and what that, how you help your clients to achieve that. I think it's very rare that you're in a career path and, ⁓ Hey, kudos to you for recognizing it early on that that wasn't like sort of what would allow you to live your version of a rich life. Right. But it's super unique. for a mentor or someone at a firm to provide that level of guidance. I mean, I think, know, I've never worked for a law firm, but I've worked for bigger organizations. And I think that to have someone that can tell you like, this isn't really what, you know, maybe you should be doing if you don't, you know, see yourself progressing through this path. It's, it's usually like drink the drink, company Kool-Aid, right? So like, what about that conversation? What about your relationship, I guess, with that mentor allowed you to have that conversation? And what do you think made her say that to you? Yeah, she was just a very vulnerable and
Load full transcript
honest person. And I think it really helped direct my career because even in that conversation, she talked about, Hey, there's certain sacrifices I make. Yes. Maybe I don't go to all my kids soccer games or all their recitals, but I don't have to worry about if they get into a private college of being whether I can afford that or not. Right. So she's like, this is a sacrifice I'm making for my family. Me just always being the eternal optimist. I'm like, there's gotta be a place where I can go to the soccer games, but then still live a lifestyle that's comfortable and freeing and allows me to have a little bit more control of my time. It's such a, an important concept in today's day and age for, ⁓ you know, hardworking professionals that also want to have. a family life, a personal life. It's funny. ⁓ you know, the concept you're hitting on is really resonating with me right now. Cause I'm reading a book right now. The book I'm reading is called five types of wealth by Sahil Bloom. Highly recommended. I've read it. You have read it. Okay. Great. Great. Yeah. I'm about halfway through it right now. And the concept that you just iterated like resonates throughout. How can you find a way to kind of accomplish your financial goals, but still be able to accomplish the things that are so much more important than financial needs. So that's, that's really interesting. Okay. So then now you decide that the Hartner law firm lifestyle isn't right for you. What made the transition to personal wealth management, financial advising, estate planning? Talk us through that. Yeah. And I feel like one of my strengths has always been good with with people, helping people solve problems. I find that my close friends would turn to me and be like, hey, I'm stuck with this. And I would bring a balanced approach, but I was always a curious kid, right? And I would always ask questions. And I feel that allowed me to help them get where they needed to go by just asking the right questions. And I've transferred that over into... the financial planning world, Where my job's not always just a client sits down and give the right answers. It's to ask the right questions to help them realize what those answers are for themselves. But yeah, just financial planning just made a lot of sense as I researched a lot of different industries and realized, hey, I could bring my legal background and it would be something that would be of a differentiator, but still being that trusted advisor that again, when I got that call from that client, I could say, Yeah, I know here are the assets. Here's how we can do it. We got you life insurance. We have your estate plan. We have all these boxes checked for a moment like this. That's a great segue into ⁓ a little bit about your process. Cause I know you've developed like a unique process to really understand the client, the family, their dynamics, not just their finances. Tell us a little bit about what that process looks like and how you feel like.
The listening part is so important to me. Yeah, absolutely. And you just touched on it with that Sawhill Bloom book. There was a book before him called The Family Wealth by James Hughes, where he talks about the five types of capital. So very similar to what Sawhill talked about, but he talks about sure there's a financial capital, right? And we need to be really good stewards of that. We need to make sure we're doing the right things to build that financial capital. But the two that he believes are even more important are the human capital, right? Who are the members of the family? How are they doing? Are they striving? What's their work ethic? What's their value? And the intellectual capital. What have they learned? And how can they share that with the rest of what James calls the family enterprise? He thinks of the family as an enterprise, right? And so learning. from James, he was such a great inspiration in reading his books when I first got in this industry, realized that I have to focus on the human and the intellectual capital of families. And so that's where I start my conversations. I don't start by asking, what are your assets? What are your liabilities? And basically going through a balance sheet, ask, where are the members of your family? Do you have kids? Do you have siblings? Do you have parents? How are they doing? Are they thriving? Are they sick? Are they fulfilling their goals? Are they stuck? Right. And just really understanding that family dynamic because I know, you know, and I'm sure we're going to touch upon this later about wealth transfer in the key, but it's, really that family and having those tough conversations. So I want to start off by having those conversations to really understand that dynamic that's going on in their own. That's great. So that's a perfect segue. So there's this idea that like wealth disappears by the third generation, right. And your experience like What's actually going wrong? Is it really about the money or is it about something else entirely? Yeah, Williams and Pryzer did a study where they interviewed over 3,000 families across two decades and their findings were seismic. So they found out that they listed down the reasons why wealth transfer fails. Number one, by a majority, is 60%. It was a lack of breakdown of communication and trust within the family. 25 % was inadequately prepared heirs and 10 % was lack of a shared family mission or purpose. So we're talking about 95 % here is a human problem. And the overwhelming majority of it is a communication problem. Only 3 % of generational wealth failure is caused by bad professional advice where they don't have the proper structures in place. They're not doing the right type of financial investments. That was a real eye opening thing for me too. And you know, I started diving deeper into, so what is it? Why does the communication fails? What are the root causes of this? And I found four things. And if you don't mind, I'll just jump into those
real quick. You know, one is the silence packed. Wealth doesn't fail in the market. It fails at the dinner table. You know, many families, even extremely wealthy ones, operate under an unspoken agreement that money is a private, almost taboo subject. And it stems from fear of entitlement, right? A lot of families believe that if the kids know how much money is there, they'll stop striving, right? There's a fear of conflict. Money conversations surface value differences, sibling rivalries, and marital tensions that families would rather avoid. And then, of course, there's cultural conditioning, right? Many wealth creators grew up in families where money was never discussed. And it's crazy money is such a, a widely talked about subject in the, in the world, but when it comes to the dinner table, it's rarely talked about. So silence doesn't protect your family from conflict. just delays it and charges interest. The second thing is that information asymmetry problem. Right. Think about that. So one generation holds all the financial knowledge and the next generation holds none. And then there's this cold handoff. We've heard so many countless examples of athletes and lottery winners, people that just aren't well equipped to handle this money because all we do is we prepare the assets to be transferred, but we don't prepare the family to receive it. would be similar to, you know, handing your cars to the key to someone that's never drove them. Right. What are you going to expect? The third one is the illusion of documentation, right? Families confuse legal planning with family. Having a will, a trust, power of attorneys creates the illusion of readiness. Okay, I checked off all the boxes. And as a former state planning attorney, that's how we were trained, right? It was get these documents in place, but it wasn't, you know, a trust says where the money goes, it doesn't say why. A will distributes asset, it doesn't distribute values, expectations or context. And the state plan may be legally airtight, but relationally empty. a will will tell you what your family will get. A conversation tells them what it means. And I think that's where we're really missing the boat here. And then the last thing of why assumptions replace conversations, right? 86 % of people in a recent study learned about their financial plan after their parents had passed at the lawyer's office in probably one of their worst weeks of their life. Right? So in the absence of communication beforehand, every family member in their own head is writing their own story about what will happen. What kind of assets they'll get, ⁓ this business is going to sell and I'm going to get this. And oftentimes then in the absence of a conversation, know, those stories end up colliding usually at the funeral, usually during the grieving process. And it's hard for wealth to survive that. Yeah. You hit on one of my favorite topics to discuss, and I'm going to kind of paraphrase what you said here, but you
said that you can't transfer wisdom and values into trust documents. So in your opinion and through your expertise and experience, how do families actually pass down the mindset, the education, the values that build wealth? And like, what does that actually look like in practice? Yeah. And that's where staring... One of the key ways is sharing your stories. And if you don't mind me digressing, just sharing a little personal story. I love it. I was struggling, you so I had started off in the law firm and then I was kind of finding my way. knew that wasn't the right path, but I didn't know exactly where to go. It took a while to get there. ⁓ I remember, I mean, mid thirties was bad. I mean, it was not being able to pay bills. I remember the repo man coming to get my cart like It was, it was a mess. was, I was really struggling at that point. And then I sat down with my dad one day and I had met this lady that was creating this cool app that was detailing stories and you know, of families and that really resonated with me. So I just reached out to her and she was like, Hey, do you want to be a beta case? You know, have your dad just share his like life stories, you know, and we can document them and we can put them on Alexa. where his voice now will always be on Alexa. So my son who's eight years old, if my dad, you know, when he does pass, my son has this library of stories that are shared in my dad's voice where it's almost a choose your own adventure where my son or his son or his daughter, they can call up my dad and he'd be like, Hey, do you want to learn about my marriage? Do you want to learn about my work? Do you want to learn about moving from India when I was a kid? All those things. But I tell you that because one of the the stories that I learned for the first time when this recording was happening was, know, the lady had asked my dad when he knew he wanted to be a doctor. And he talked about it nine years old, how a doctor came, he lived in Bombay, he lived in a two bedroom flat with nine siblings, right? Like very crowded, you know, just a very, a very tight place. And his dad was really sick. And he remembers his mom called the doctor and a doctor came and cured him. And that's where he realized at nine years old that he was going to dedicate his life to bringing medicine into the home. And so he dedicated his life and, you know, he helped bring dialysis, you know, to people's homes, as opposed to them having to go to two clinics. And that just, that was such a eye opening time and moment for me that. Here's my dad at nine years old finding clarity, right? And it really gave him purpose and fulfillment. And that's what I was searching. It just led me to like, pick yourself up. You you've grown up and I'm that third generation. I'm supposed to be that statistic that squanders wealth. And I was on that path, right? But you know, hearing the stories of your family tying into some of the struggles they may have had or some of the influences, you know, that that's that can really bind families and help that those younger generations who realize, hey, times weren't always rosy. Yeah. Yeah. Well, thank you for sharing that. Let's talk a little bit about like a busy, hardworking professional. Maybe they're an executive leader for a firm or they own their own business. It doesn't really matter, but someone that has high income, maybe they've got some level of ownership in their firm and they want to start thinking about a state. Like what's one assumption they're probably making right now that could potentially cost their family later? I would say procrastination. Okay. You had an episode where, you know, similar to selling a business, right? Like it's like trying to buy fire insurance for your house or house insurance while it's burning down. While it's burning down. Right? Like you've got to start doing that stuff in advance. You can't procrastinate and... You know, over 50%, the majority of Americans don't have any estate plan. And anytime someone comes into my office, they say, ⁓ I don't have an estate plan. I was like, you do. It's just what the state decides. Right? So everyone has an estate plan. It's whether you want to be in control of it and you want to dictate what is the outcome of the estate plan as opposed to the state doing so. And for those high income, I mean, there's so many moving parts, right? And that estate plan has to integrate with all the other things going on with your tax strategy, with your financial accounts, with your investments. It has to be a very cohesive thing. there's not, if you make over 3 million or have a net worth over 5 million, you need this trust and you need this. It's much more complicated and nuanced. Yeah. I love what you're saying. These, these different pieces of your financial life can operate in silos. needs to be sort of a very unified approach. I completely agree with that. All right. So you told us a little bit about your own experiences, which I appreciate you sharing that today, knowing what you know now, knowing what you've been through both on the family dynamic front, on the personal front, on the professional front. What does a rich life mean to you today, Ashish? I'd say a rich life is living with intentionality, really being able to dive deep into yourself and asking yourself the hard questions, right? Asking yourself, where do I want to be 10 years from now, right? And then what are those steps that take me to get there? Right? And someone that constantly does that, they're just going to keep living that rich life because they're going to be, they're going to be doing the steps now that allow them to get to where they want to do. And you keep doing that over and over, rinse and repeat. You're going to be unstoppable. Yeah. I love it. I love it. You're right. It's you have to really be prescriptive and almost commit to, and I believe you have to kind of go through an exercise to figure out like, what do you really
want out of life? How do you want to be spending your time? How do you want to be spending your financial resources? And then to your point, once you figure that out, I actually think in the grand scheme of financial planning, that stuff's the hardest part because the rest can be very much prescribed based around that and customized for your situation. All right. Very, very cool. Well, that's a, that's a good stopping place. And ⁓ now we're going to transition into the lightning round. So if you've listened to our episodes before, you'll see that the, audience gets to know you a little bit more. And we just want to hear the first thought that comes to your mind and we'll have a couple of questions for you along the way. That sounds great. All right, let's do it. One meal for the rest of your life. What is it? My mom's Chole Bhatura. It's an Indian restaurant with chickpeas and this bread, almost like a fried naan type thing. But it's my total comfort food that rainy, cold day. One last meal. That's it. All right. I love it. What's one tool or piece of technology other than your phone or your computer that you can't live without? That's a good question. I would say It's turning now more into to Claude. Claude is such a weapon, In terms of understand like I'm I'm a boomer. I'm just learning it. I'm in the early innings of it, too, but just seeing some of the capabilities and the technology. mean, forget work stuff, right? Like I've seen people automate morning reminders, automate their entire calendar, automate everything. Right. And so I think going forward, that would be a hard thing for me to give up. Yeah, I'm with you on that one. We talked about, we talked about Sahil Bloom's book. What's a book that's influenced how you lead or think? Yeah, and just staying in this work, I'm gonna, I'm gonna plug James Hughes again, Family Wealth. I mean, that really led me down this path and has been such an inspiration because he gives examples of why, like the Rothschilds were able to... keep wealth for 250 years, whereas the Vanderbilt's lost it all in three generations. Right? And so detailing that and understanding that helps me bring that kind of advice and guidance, you know, to my clients, like, Hey, you gotta be sharing your stories. You gotta be sharing your values. You gotta be sharing, treating the family as an enterprise. Yup. A hundred percent. Let's talk about your bucket list. If you could share one item that you've already accomplished, if you have one. And then what item that's, ⁓ that's still on your list. Well, I'm a, I'm an avid golfer. Me too. All right. So let's talk about that. We can, we we can spend a whole episode on that. Pebble beach and masters were my two things. I knocked off Pebble beach last year and one day hope to get to play Augusta. Just, I mean, everyone tells me the undulations and all that like TV does it no justice. So I haven't been there. I would love to start off by going there, but, you know, just top of mind, you know, it just brought brought golf on the. On this rainy day, that's certainly a big bucket list item. So I've been to the masters, haven't played it, but I'd hope to play it someday. I've been to the masters and I would agree. TV does it, no justice. TV does it, makes it look really, really good by the way, but it still doesn't do it justice as far as like the terrain and Pebble Beach is on my list as well. So, glad you got a chance. What was your take from Pebble Beach? I was, I remember just standing on the 18th fairway. just staring out into the ocean. And I wasn't playing particularly well, it just, sense of calm and peace just like in belt my body. Like I'm on this holy grail of golf and you know, felt really blessed and really at peace just being there and getting to share four hours on that ground. So it was pretty incredible. Very cool. Very cool. Love it. What's one skill that you're intentionally trying to get better at right now? I would certainly say, you know, we just talked about Claude, you know, I'm really trying to understand and use AI without, you know, I've read some things, I've heard some things how I don't want to lose my creativity. I don't want to lose, you know, my ability to think, right. But being able to then use something like that to really help. automate some of the mundane, right? So I'm trying to get better at that to help free up time. So maybe that does give me a little bit more time to be creative. think that's what we're all striving for. I don't claim to have it figured out. I don't think anyone has, right? But what we're all striving for is to use AI to make us more creative, not less creative. And I think that's a challenge. I mean, I really do. I don't think it's easy, but you know, I think it's something that will all be. trying to learn, understand, practice, and get better at over time. So that's a great one. What's one belief about money that you wish people would unlearn? That it's taboo to talk about. Okay. Let's unpack that a little bit more, because you deal with a lot of folks that are on the higher net worth scale. So how does that come through in practice and what sort of coaching and guidance do you give to people around just sort of like the idea of talking about communicating, sharing with at least family, but maybe even friends. Let's talk about that for a second. Yeah. And these are some good takeaways that I think would be good for, you know, your clients that, you you do with your guests such a great job of, you know, building the financial tools. But I would say the first thing is schedule that uncomfortable conversation. Sit down with your spouse or your adult children and ask them, what do we want this wealth to do for our family? You don't need an agenda. You need to just start that conversation. Right? Stop treating your estate plan as classified information. Right? Share the intent of your plan with your heirs. You don't have to share exact dollar amounts, but share the why.
Why did you structure it this way? What values are you trying to preserve? I would say hold an annual family meeting. Right? Like have a time where you bring everyone back. Hey, son, what are you learning in New York? Daughter, what are you learning in LA? Like how can that benefit this whole family as a whole? And I would certainly give a plug to the advisors too, right? Like bring your advisor into the family conversation, right? Because they're going to be able to bring financial tools and skills that could potentially help the children as well as certainly the adults as well too. I think. You know, it starts with that hard part that we tend to just really avoid because again, I talked about those earlier, right? It just might be taboo. They were, they were conditioned as kids, like, Hey, my parents didn't talk about, so I'm not going to talk about it. I don't want to ruin them by telling them how much money is there. Whereas by not having these conversations, you're actually doing it more of a disservice. Well said. Love that. All right. Last one, one piece of advice you would give your younger self. What is it? I would say. Always to be curious, always to learn and not be afraid to fail. know that's a couple of different advices, but I think the, not afraid to fail, you know, I read that once before I heard it a little later, but if you're not failing, you're not trying hard enough. know, whereas I think I grew up always trying to never fail. Right. And, and I believe that probably stunted my growth and took me a while to kind of build to now where. I want to push the envelope. I want to know, hey, okay, I'm not as good at this, but let's keep working at it so I can get better. Very cool. Very cool. And then Ashish, if our listeners want to learn more about you, your firm, what you do, tell us a little bit about the firm. Tell us a little bit about your client base and where's the best place to connect. Absolutely. So you can find us at signaturewealth.com. We are Hightower Signature, which is... ⁓ ⁓ A large area, we're actually, sorry, backed by Hightower, which is our parent company based out of Chicago. You know, we have 19 locations all over the country, over, you know, hundreds of advisors, and we manage 20 billion in assets under management. You know, we give really powerfully personal advice. We have access to private markets and opportunities often reserved for bigger institutions. We do sophisticated estate planning and then certainly we are focused on the family. are focused on how do we make that enterprise thrive and not just individually. Very, very cool. Well, thanks so much for coming on today. I enjoyed the discussion. Appreciate you sharing your wisdom, your experiences, some of your personal challenges and struggles, but also achievements. really enjoyed the discussion. Thank you so much, Dan, for having me. it. That's it for the episode. You can find our podcast along with our newsletter and our YouTube channel all for free at makingsenseofyourmoney.com. And as always, advertise your version of a rich life.