When you envision generational wealth, do you see images of private jets, lavish parties, extra chilled martinis, and designer clothes for toddlers come into view? That may be, but this post is not about those already wealthy.
Having and raising kids is the most challenging job in the world. As parents, you are responsible for their wellbeing, keeping them safe, healthy, supporting them in any way possible no matter how sassy and disrespectful they become as they enter their teens.
Generational wealth refers to our ability to pass our assets to our children and grandchildren as part of our family legacy. The current generation wants to leave behind family wealth as a legacy for our children, the next generation, so they have financial advantages to better themselves.
Setting aside money when unexpected emergencies happen is essential so you can pay your monthly bills on time. You can’t predict when your boiler breaks, the car needs fixing, or your pet requires surgery.
Spending less than you earn so you can invest the rest is the mantra for successfully growing your wealth. The tripwire for many is not being able to resist overspending and having high debt levels. It means making trade-offs that align with your financial goals.
Housing wealth is the most significant contributor to the net worth of Americans, accounting for over 32% of the increase across all income levels.
The household wealth of a homeowner at $255,000 is 40 times greater than the wealth of the renter at $6,300. Your home keeps pace with inflation and comes with tax benefits.
Stocks have a better risk-return profile than many assets and keep better pace with inflation. Investors can buy low-cost index mutual funds or ETF’s with instant diversification in a long-term perspective.
Having your own business takes hard work but can make quite a legacy for your family.
The best chance you have of passing on your business to the next generation is indoctrinating them to various parts of the business at a young age to whet their appetite, not obligate them to serve the company.