Creating Sustainable Generational Wealth. Many well-off families lose their wealth by the time their grandchildren come around. This is a common problem, but some families manage to keep and even grow their money over many years. Let us talk about how they do it.
Big family fortunes often do not last beyond three generations, up to date studies show that around two thirds of rich families use up their money by the second generation, and most do by the third. But here is the thing: it does not have to be this way. Some families have retained their wealth for centuries.
These successful families do a few key things. First, they teach their kids to be responsible with money. They also make smart investments and set up plans to protect and grow their money. They often have designated professionals such as a Wealth Manager to take care of their finances. Plus, they adjust their businesses to work well over a long time.
Inheritance is important for them. It is like the foundation of a building – it keeps everything together. They plan it carefully, so there is no fighting among family members. This plan also shows how to share money, property, and responsibilities. By doing this, families make sure their money continues to grow with each new generation.
When families organise inheritance well, it does not just help with money. It also teaches important lessons to the younger family members. They learn how to take care of the family’s wealth responsibly. So, a good inheritance plan is like a guide that helps future generations keep the family’s money for a long time.
Now, let us talk about how they invest. These families do not just think about making money quickly. They have a long-term plan. This means they decide on a mix of distinct types of investments and adjust it over time. They stick to this plan even when the economy goes up and down. It might be hard to stick it out through tough times, but history shows that waiting usually leads to more money in the end.
So, by planning carefully, teaching responsibility, and making smart investments, these families break the cycle of losing wealth in three generations. They keep their money growing, passing it on to many more generations to come.
Private Client Consultancy are committed to supporting families in building and preserving their wealth across generations. As your financial advisers in Spain, we can help you to create an enduring legacy. Contact us today at email@example.com to find out what we can do for you and how to preserve your family’s wealth.