Are the kids all right? Preparing the next generation for wealth.
Family Office Exchange shows specific family business education is the key.
For children, growing up in a wealthy family comes with certain challenges. Many such children have difficulty conceptualising the value of money, or take their family’s wealth for granted. On the other hand, they may feel a sense of guilt or even shame for enjoying wealth they didn’t earn, and a sense of pressure to “make the most” of the fortunate situation they were born into. Indeed, research shows that adolescents from affluent backgrounds are more prone to depression, substance abuse and anxiety.
Parents have the even greater challenge of helping their children become productive and grounded adults despite their wealth, and helping them make the most of the opportunities that wealth provides.
Getting this right is a challenge, but the Family Office Exchange (FOX) has some ideas of where to start. The solution, according to FOX, lies in appropriately educating the next generation about family business and wealth. Parents may find it useful to plan out their goals – for instance the values they want to instil and the behaviours they wish to encourage – and seek out appropriate educational resources accordingly.
But it’s not just financial education that matters. Education in general enables children to develop interests and forge their own path. Bill Gates, speaking about his own children, said, “You’ve got to make sure they have a sense of their own ability and what they’re going to go and do.”
What’s more, actions speak louder than words. Gates doesn’t plan on leaving his fortune to his kids. Although he wants to “strike a balance so they have the freedom to do anything”, he doesn’t want to shower them with money so that they can do nothing. “They need to have a sense that their own work is meaningful and important,” he said.
If children develop their own identities and sense of purpose, they’ll be all right. Providing them with access to specific family business and wealth resources as offered by Insights will provide valuable guidance. Through our extensive video catalogue they can also watch how their peers worked through these challenges.