Wealth Transition and Entitlement: Shedding Light on the Dark Side of a Charmed Life

Abstract

A 20-year field research study reveals that 70% of families lose their wealth due to infighting, long-held resentment, lack of trust, and poor communication within the family. The second generation often finds that the values they grew up with while living an affluent life do not align with the values by which the family wealth was generated. The expectations of the heirs are that the wealth will continue without any effort on their part. This breeds entitlement, a lost sense of purpose, and ill-prepared future administrators of the family’s wealth. A redefinition of preservation of wealth as preservation of the individual enables a new focus to be revealed. Learning how to engage in difficult conversations that build trust and openness rather than damaging relationships is a skill that can be developed and woven into the thread of a family across generations. Creating a well-established mission built on the shared values of every member of the family is critical to maintaining harmony. The role of the head of the family is to facilitate conversations that support offspring’s dignity, aspirations, and ability to provide for their own families.

TOPICS: Wealth management, in wealth management