How To Raise Heirs
This is the conundrum of wealth creator parents: they want to raise children to value the hard work that helped them create wealth, but at the same time pass them wealth that means they never need to work. Talk about mixed messages!
In order to actually do this, one would have to live well below one’s means, and/or withhold access for children to the family wealth so that they can live it ‘tough’ for a period of time until they were deemed ‘ready’ for the wealth. This is not just difficult, it can have serious unwanted negative side effects.
Instead, it might be better to seek to instil the value of ‘stewardship’ within the family: that the family is blessed with wealth, and what comes hand-in-hand is the need for responsible and conscientious management of the family wealth towards a higher purpose than consumption.
One cannot start early enough with the right kind of messaging as attitudes to money and spending are formed as early as age five. Children are often aware of the family’s spending, but don’t always have a view of how much the family saves, invests, and gives back. We can prepare children for a successful relationship with money by telling family stories and talking about values.
Consider This: When did you find out your family was wealthy? How did you find out? Was that experience positive or negative? How does your family talk about wealth or answer questions from children about it?
- The parenting paradox of the ultra-wealthy
- Helping The Heirs Of Super-Rich Families Become Global Stewards
- Are You Living in the “Shadow” of Wealth?
- What’s Your Relationship with Wealth? For many, It’s Complicated
- Dollars and Cents: Having “The Talk” with your Children
- “Whose Money is This?” Part 1: Prepare the Heirs
Here is more on reading on family business governance.