What some people would think of only as a blessing can also be a curse.
Family wealth is, at times, a double-edged sword, as Thayer Willis, author of “Navigating the Dark Side of Wealth: A Life Guide for Inheritors” and “Beyond Gold: True Wealth for Inheritors,” wrote in a recent article for Forbes magazine.
“But what many people don’t realize is that family wealth can be a curse. It was for me as a member of the family that founded Georgia-Pacific Corp.,” Thayer stated. “And that has given me an inside perspective on the privileges and tragedies that wealthy families encounter.
The biggest curse of intergenerational wealth for me and many other people is the illusion that you don’t have to do much with your life. You might want to and you might make the effort, but you don’t have the same pressure to earn enough to live on. And that takes away a lot of the incentive to find meaningful work.
Though many wealthy families attend to tax, financial and legal planning, with expert advice and well-developed strategies, they often neglect psychological planning. The consequences can be dire.”
Thayer offered three ways in which, without the proper psychological preparation, inherited wealth can amount to a curse, rather than a blessing.
- Too much too soon
- Too much financial focus
“This results in the familiar demotivation that wealthy parents worry about,” she said of the first issue. “A form of laziness, it involves remittance addiction, being dependent on the money source. Kids aren’t required to support themselves. Parents have low expectations of the next generation.”
“This focus can be so big that families neglect human, intellectual and social capital in the family,” Thayer indicated regarding a laser attention on money matters. “As a result, there’s no balance. Instead, the emphasis is on the dollars, the assets, the strategies and the money managers. Family meetings only cover financial concerns.”
“Ingratitude is insidious, based on fear and anger. It leads to low self-esteem, insecurity and the self-doubt that comes from never having become good at anything.”