Spending money that previously belonged to someone else can feel shameful, knowing they did the work but now you get to enjoy it. And it reminds us that one day, we\u2019ll die too, and make others feel weird about spending our money. <\/p>\n
Beneath the layers of awkwardness this topic produces, there\u2019s good news. Even if no pot of gold comes to you, you can start building wealth now, with your kids.<\/p>\n
It\u2019s ironic, though, that the more financially sorted you are, the more at risk your kids might be of blowing it all on some terrible decisions. <\/p>\n
Why? Being raised in abundance can often fail to deliver the tough lessons only scarcity can teach. I\u2019d like to help my kids with a house deposit, if I could, but is that really helping them, or just easing my own anxiety about their future? <\/p>\n
As we focus on filling their cup, we risk failing to build a vessel capable of holding wealth. <\/p>\n
\u201cNinety per cent of wealth disappears by the third generation\u201d is a quote not based on any solid research, but it\u2019s logical. Give a kid a fish, and it\u2019s gone by dinner; teach them to fish, and the pond\u2019s theirs for life.<\/p>\n
So, if comfort\u2019s the trap, what\u2019s the fix? Scarcity? Discomfort? Not pain for pain\u2019s sake, but a little laissez-faire and delayed gratification couldn\u2019t hurt. Perhaps start with chores that pay, then lessons on allocating earned pocket money, then the importance of giving, saving and investing. <\/p>\n
Finally, charge them board when they get their first part-time job. Teach them these principles, and maybe they won\u2019t feel the need to bury an inheritance in shame later on. If it\u2019s done well, they\u2019ll hold the wealth you give them or at least be able to grow some for their kids. <\/p>\n
And if you\u2019re fortunate enough to get an inheritance one day, or not, this is important. I\u2019ve sat across the desk from hundreds of people with an inheritance coming and, almost always, they make one of two mistakes.<\/p>\n
The first is less common: knowing money\u2019s coming justifies a life of leisure. There\u2019s no budgeting, no discipline, and no plan for the future. They\u2019re black holes for intergenerational wealth.<\/p>\n
The second mistake is more common \u2013 and even more tragic. People live like the money\u2019s never going to come. Instead of investing more aggressively today, growing a bigger family, or being more generous, they pay their mortgage down and save the rest in term deposits. <\/p>\n
In the Bible, there\u2019s a parable of some servants given money to look after in their master\u2019s absence. One buries it, afraid of losing it, and one invests it, multiplying it for when their master returns. The master praises the one who took a risk and reprimands the one who didn\u2019t. <\/p>\n
The moral of the story? An inheritance you can count on is a safety net most people don\u2019t have, so instead of playing it safe, it should give you permission to swing bigger. Instead of burying the knowledge of family wealth in shame, build before it arrives. Just make sure the money is coming, have the conversations, and remember you\u2019re always one will away from a rude awakening.<\/p>\n
Now I know not everyone has a childless, rich Aunt Tina. So, every bit of your financial security depends entirely on you: no safety net, and no back-up plan. <\/p>\n
There\u2019s a strange freedom in that. There\u2019s no awkward reading of the will with a lawyer, and you\u2019re not dependent on a relationship holding up until someone dies. Meet your real Aunt TINA: There Is No Alternative.<\/p>\n