It just seems like another dumb carrot to chase
It's great if you can provide some nice things for your kids/grandkids (private school, down payment on a house, etc), but to worry about whether my great-grandkids' are set for life is stupid. i feel like nobody talked about "generational wealth" 10 or 20 years ago.
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There's a great quote that hard times make strong men, strong men make easy times, easy times make weak men, weak men make hard times. So I feel like if I left my son a lot of money he may grow up feeling entitled and being a pussy / not learning how to have a strong work ethic
If you actually think that quote has any kind of value beyond right wing memes, I can almost guarantee you, handing down generational wealth isn't going to be an option for you.
lmao sure because we all know generational wealth is made by those who think there are more than two genders
You’d be surprised; the aforementioned quote holds a lot of truth.
About 70% of wealthy families lose their wealth by the second generation, and 90% do by the following generation, so the notion of generational wealth is often blown way out of proportion.
I don’t think anyone here is actually striving to have their kids “set for life”. Fuck that. I want enough money to quit my job and chill, while still living comfortably.. kids can have my house and whatever is left over in the 401k when I die
Ah, the good old boomer mindset that brought our society to where we are now.
What you want me to do.. work until I’m 80 years old, for my kids? Shut up zoomer
the guy you called a boomer literally wrote a thread called "are boomers the worst generation?" https://www.wallstreetoasis.com/forums/are-boomers-the-worst-generation
what a lazy retort. historically parents provided for the kids so the kids could provide for the parents when they became old and decrepit, the idea of the non-upper class leaving wealth behind is completely novel which is part of the reason why I think it doesn't usually work well. it's your parents' job to prepare you for life, not financially insulate them from having to do so themselves
My parents raised me with the understanding of a clear cut off after college. I think it’s generous since 18 is also a common cut off. I’ll probably do the same for my potential kids since they’ll have the opportunity of college, but will be forced to make their own money after. I don’t know how beneficial dropping a paid-off house and car, trust fund, etc. on a kid could ever be. Nobody should start a video game they’ve never played in ‘new game plus’ mode. A classmate of mine has access to a lot of money and it’s made it difficult for her to relate with some of our friends who grew up middle class. Really only works if you’re betting they’ll just interact with other rich kids.
New game plus mode…made me chuckle lol.
I assume you’re a tlou2 fan?
Why would anyone get cut off at 18 in the current day and age?
It is extremely difficult to pay for college and housing with a minimum wage job.
I know some people who's parents "spoil" them yet they're incredibly hardworking
I know a guy who was born in India, went to public schools and college there, moved to the US to get a master's at some state school, worked as an engineer for a bit, then got an M7 MBA, and now he's the CEO of a large tech company that sells, among other things, video game systems, operating systems, and productivity programs.
Still doesn't mean starting out in the Indian middle class gives you great odds at ending up leading Microsoft.
Do I care? Sure. Is it a driving force that overwhelms my other goals in life? Nah. I'd like to work on projects and investments that interest me and are lucrative, and creating multigenerational wealth is a positive side effect, not the end goal in and of itself. Like most people, I have a quality-of-life threshold that I'm not willing to cross for the next marginal dollar (which, in addition to my talent level and risk appetite, is why I'll never be a billionaire).
I like the idea of creating a safety net for my kids - I don't want to gift them a stipend so they can do whatever they want, but I want them to be insulated from catastrophic events. If they get hit by a car, I don't want them popping pills to manage the pain so they can work through it in order to pay the rent. I want them to be able to escape an abusive situation without wondering if they'll have a place to sleep or if they'll be able to feed their own kids.
I could be convinced that investing in their future is a way to help them create their own safety net. Paying for education seems like a logical thing to fall under that bucket. Maybe investing in a place to live - haven't decided on that one.
If my wife and I do a good job, then subsequent generations will continue the cycle and take care of the rest. I'd like for my kids to worry about (and be responsible for) creating a safety net for their kids, as opposed to looking to us to do it.
Here’s my philosophy: You should put everything you have into growing them as introspective, thoughtful adults. You don’t need wealth to do that, however you need a minimum amount of resources to do it well, such as quality time together, good education, opportunities for them to explore themselves
I lost all respect for this term after Master P had a masterclass on it. People paid $1k to meet Mr. “Make em say Uhhh!”
I care about it in the sense that I want to accumulate enough wealth that it will become generational. I'll never think about it from the perspective of wanting to have a ton of money that I can pass on as a legacy, but yes at a minimum I'd want to make sure my kids are taken care of from an education perspective. I never want my kids to lean on my wealth and quite frankly if I reach a significant level of wealth, I'd seriously consider keeping it in a charitable trust in lieu of passing it on. Obviously my opinions might change when I have kids as actually having kids triggers the whole parental protective instinct I don't posses right now. Bottom line is I'd want my kids to make it on their own. I'd be happy to indulge them in family things such as nice vacations etc but I'd want them to work as soon as they're able to and start earning their own. Bit of a tangent but to me generational wealth is totally tied to your children given they'd be the primary beneficiaries.
My personal goal at the minimum would be to have my kids be more well off than I was/the previous generation. This trend has continued for a few generations in my family at this point and I'd like to keep it up. If my kids decide to take a less lucrative path that is okay too as money is not everything.
Generational wealth is on another level though at least from my perspective. From my experience though trust fund kids typically two generations removed from the wealth creators more often than not don't handle the money well.
not at all, I want to provide for them during life, teach them well, and then spend as much as humanly possible so I die with zero
www.diewithzerobook.com
I see wealth change hands all of the time, it's mostly a waste for the recipient, I rarely see big sums of money enable someone to have lasting life changing experiences, more often than not, it makes them greedier, doesn't change miserliness, and makes them hate taxes more. I can think of one specific situation where it rescued an unfortunate divorcee out of destitution, but beyond that, fuck it. pay for kids/grandkids education during their lives (or if they're young, fund those accounts now), make your charitable contributions NOW, and give your benefactors the money when they need it not when they're 60 or 70
and while misses brofessor has been dropping hints, I did write a thread on how I don't want kids, so who tf knows
Yet again, I'm gonna have to read a book you've recommended.
It's hard for a tiger to change its stripes. Someone who has leaned on frugality and sacrifice to generate meaningful wealth over decades (or, believes that those have been important inputs, even if they haven't really) develops an emotional attachment to saving and wealth preservation. It's not a logical argument, it's an emotional one. I've seen a lot of baby boomer business owners spend far less than their means and accumulate fortunes because, basically, they're behaving in a way that would have made their Depression-era (or immigrant) parents proud, and that brings them peace.
It can be couched in all kinds of defensible arguments about what it can do for subsequent generations, but it's not really about the grandkids. It's about the ego and the security of the saver. It makes them feel good, even superior, like they're doing the right thing.
Not a criticism, just an observation. I've caught myself in this mindset often, and I have to challenge myself - is this gift really for the recipient, or is it for the giver (me)?
P.S. Baby fever is real. Also, can themrsbrofessor make an account please?
very fair points, it is ego driven I think as well as a security blanket rather than a logical if this then that calculation. may be rational, but at some point when you've got $10mm in the bank with a $100k a year pension and only take out $50k a year from your investments, you have to ask yourself what all of this is for. to that end, many of my conversations these days are encouraging people to make my AUM smaller (you've won, fly first class, don't skimp on anything, TREAT YO SELF)
and sorry layne, next time we get together maybe we can get the wives involved, but until then, mrsbro has next to no online presence and I like it that way
I haven't taken a penny of my parent's money since I was 21 and I wouldn't expect my kids to either.
I'd like to leave each of my kids $5ml (in today's dollars, so growing in line with inflation) when I pass on. Aside from this, want to spend plenty of money on their education, fully pay for their colleges, give them good vacations, potentially pay for the down payment on their first houses, etc.
I'm not going to destroy my life working harder than that, this is the most I feel I can provide for 2 kids (maybe 3 depending on how things go but that's a bit of a stretch when you're pricing in 4% 60yr inflation assumptions) fairly comfortably. Will probably reassess all this stuff once I actually have kids & modify as needed, just rough thoughts for now
At the OP, I feel the term "generational wealth" is used in two ways.
(1) I agree it is another dumb carrot, but its also used as a short of wealth/elitism move. With more access to investments, more people are probably getting close to having $1M saved for retirement; a good amount, but not super rich. Saying "generational wealth" is just a way for someone with several million dollars of saving to separate themselves from people with "only" $1M.
(2) I think its the carrot used by people pitching their investment system or by "financial experts". Take it as, if you don't come from a family that has money, or really knows a lot of money, giving you the chance to build "generational wealth" sounds like an intriguing idea.
In the wide, its close to that argument of being someone with $1M vs looking like someone/what society thinks is someone worth $1M. Or put another way, its people who believe in saving for a rainy day, vs people who think, what the point of saving if you can never use it?
I don't think several million dollars is generational wealth. Think about how much money that needs to be. You need to have enough that dozens of people can spend six figures a year without adding a dime to the pot, all while having that income be taxed and estate taxes chipping away and all that. As with most things, I don't think folks on this site truly understand what that entails. Yes, for myself, having 5-10mm in the bank is enough that I'd never have to work again. It's not "buy a yacht" money, but for a couple more generations to live like that is not possible on that amount of money. Half of it is gone the moment I die. Assuming I have an average number of kids (lets say 2), all of a sudden you need twice as much wealth to live off passive income and have the same net revenue. Once they have spouses, make it 4. If they each have two kids, you've got another 4 mouths to feed off that single income stream, and if they have spouses.... so on and so forth.
You need tens of millions of dollars, UHNW status, to have "generational wealth," not $8mm generating 5% returns a year.
I agree with all your points. That is the way to build generational wealth and definitely need more than $8M to do it. If you have true generational wealth, you are also not waiting until you die to hand it to relatives, probably have some good lawyers/investment vehicles and a lot of tax free gifts over the years.
What I'm saying is "generational wealth" is a term used by people with say, $8M, so make themselves seem more esteemed/established than they really are. Also, I'd add, theres the "TV/hollywood" way of generational wealth, vs how it actually happens. First one is probably more along the lines of say a Jeff Bezos, build Amazon from a working class family background; the family money with be around for a while and have a long tail. Second is more akin to Bill Gates, coming from an upper middle class family, probably more of a step function.
This. I keep seeing videos on social media pitching generational-wealth. I feel its overly-hyped and people do not fully grasp the kind of wealth needed to make it happen.
I used to think I wanted to pass on generational wealth,..but I’m way more interested in experiencing my life and using up pretty much everything I earn (will earn), giving it away, eating really great food, seeing special things, buying things I like.
I send my kids to private school, will pay for college if necessary, if not they can have their 529s and buy a house, start a business etc.
I arrived at that mindset before reading die with zero. It only reinforced the sentiment.
Care is a nebulous word, and probably not very precise in this case.
Is generational wealth evil in and of itself, no, is Good(?), sometimes. It is the end result of what every ambitious person, and what some/most parents want. At one end it represents value created for society. People use your services and products, by exchanging their services and products. You created a product that was so useful that people willingly, at an arms length transaction, decided to give you money(the medium of exchange) for their products and services. This seems like you have been rewarded by society for helping it. That is what capitalism is all about. Just think of all the libraries, foundations, hospitals, and universities that people with generational wealth have helped build/fund/create.
Here is the kicker, generational wealth likely only lasts 4-5 generations, at most. The only way to keep it is to make sure trusts are set up are through primogeniture. The math is easy, let's take 400 million, because the generational wealth number of 200mm was given to me about 20 years ago. Founder = 400mm, 2 kids = 200mm(per kid), grandkids(lets say 4), so now, 100 hundred. Each smaller family has broken the capital up to below generational wealth. All it takes is one idiot kid to sink the ship.
Long story short, yes.
My parents are getting older, my younger siblings will go to graduate school.
I would like there to be a point when I can provide for them, because they have given me so much…
Long story short, yes.
My parents are getting older, my younger siblings will go to graduate school.
I would like there to be a point when I can provide for them, because they have given me so much…
after you die, nothing will matter for you.
people who care about generational wealth are just boring fucks who have no hobbies and don't know what to do with life, and the only thing they know is to obey commands at work and feel gratification from dropping checks every couple of weeks. so they prefer to trick themselves into thinking that their life has a meaning because they're building generational wealth, whereas they're just wasting their worthless life.
Most accumulated wealth is actually lost in only a few generations. More than 80% of millionaires here are self made. Being obsessed with generational wealth is more than likely not even a logical goal due to the simple tendency of entropy of money in any system. It’d be better to focus on living a full life and also raising responsible, introspective and well balanced kids rather than obsessing over their trust fund. My $0.02
This is the comment I was looking for lol. The notion in itself is often misconceived.
About 70% of wealthy families lose their wealth by the second generation, and 90% do by the following generation.
+1 SB from me!
The only way to have true generational wealth is to raise your kids to be good character, productive citizens of society. Money comes and goes like a vapor in the wind, but good character men and women can make lasting effects on the people around them.
No, full stop. Even if I had that much money, not sure I'd give it to my kids anyway, would really depend on what type of people they became.
your legacy is an illusion. we will all be forgotten about in. a few generations. tombstones won't even be visible.
more important in my opinion to worry about teaching good values and work ethic and how the world works. Then pass on a few mil and you can be fairly confident it will grow instead of shrink. My goal is not simply to pass on money but a future.
My parents were lower middle-class and didn't have the means to help with my college or really anything once I moved out of their house. I turned out fine. Had to work harder than some. I would rather instill good values in my kid than spoil them. Spoiling them won't get them anywhere. If I can instill good values, AND THEN help with their education, and have a few million for them left in the 401(k) when I die at the early age of 60 from day drinking all the Scotch I've collected every day after I retire, then great, because I know they'll be way less likely to blow it if they understand the value of it and how much work it takes when you start with very little.
Death from scotch. Respect. Thats the dream
I care about wealth. I guess whatever is left when I die becomes generational. So yes.
Having generational wealth is such a coin flip, but there are only 2 primary ways to get it IMO:
Investing
The NFT and Bitcoin bros will be weeded out if they keep coming back to the table…
I’m simply focused on creating enough wealth to create a comfortable life for me, my wife, and my kids. But they will work, i see what the Default rich parents life does for kids… mostly not good
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