Berkshire Hathaway CEO Warren Buffett issued an unexpected message to shareholders this week, wherein he announced updates on what will happen to his massive fortune after his death and offered some advice for others on handling how to pass on their wealth.
In a letter posted to the $1 trillion holding company's website, Buffett, 94, announced he would be donating around $1.1 billion of his Berkshire shares to his family's four foundations, and said his three children would be responsible for gradually distributing the rest of his holdings following his death.
The tone of the letter suggests the "Oracle of Omaha" is feeling his mortality.
"Father time always wins," Buffett wrote. "But he can be fickle – indeed unfair and even cruel – sometimes ending life at birth or soon thereafter while, at other times, waiting a century or so before paying a visit. To date, I’ve been very lucky, but, before long, he will get around to me."
Buffett noted that his children, who are now 71, 69 and 66, may not live long enough to distribute his estimated $150 billion fortune themselves, so three potential trustees have been designated who could also step in to help fulfill his wishes to distribute all of his wealth after he dies.
He explained the reasoning behind his policy that all foundation decisions would be made unanimously, said he updates his will every few years and keeps it simple, and also offered some words of wisdom for others when planning their own affairs.
"I have one further suggestion for all parents, whether they are of modest or staggering wealth," he wrote. "When your children are mature, have them read your will before you sign it."
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"Be sure each child understands both the logic for your decisions and the responsibilities they will encounter upon your death," he continued. "If any have questions or suggestions, listen carefully and adopt those found sensible. You don’t want your children asking ‘Why?’ in respect to testamentary decisions when you are no longer able to respond."
Buffett said that over the years, he and longtime business partner and friend, Charlie Munger, who died last November, "saw many families driven apart after the posthumous dictates of the will left beneficiaries confused and sometimes angry."
He said that in those instances, "Jealousies, along with actual or imagined slights during childhood, became magnified, particularly when sons were favored over daughters, either in monetary ways or by positions of importance."
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"Charlie and I also witnessed a few cases where a wealthy parent’s will that was fully discussed before death helped the family become closer," Buffett added. "What could be more satisfying?"
