Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
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Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#2[deleted]
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#3I love how all these articles assume families are functional and they all act in the best interest of each other.
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#4Another aspect: savings and investment habits. If you are born rich and have savings and investment habits that are good, you will remain rich. Savings and Investment habits are a large determinant. The article suggests that the prior generations' "worry about entitled behavior" is the second dominant cause, while financial illiteracy trailing behind at third (in order of presentation). But I find that quite misleading. Are the wealthy really wanting to put their offspring at a disadvantage because it is perceived as laziness? That's "patently false" as my friend says.
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#5I love how all these articles assume families are functional and they all act in the best interest of each other.
I submitted it because I saw a comment somewhere else about the rich being locked into unfair advantages and classes ossifying. Seems to not be true if these stats are to be believed.
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#6I'm not completely shocked, and for a lot it does come down to literally greed. My grandparents immigrated to the United States on both sides of the family, and had my father and mother respectfully. They saw their work ethic and worked equally hard, reaching to high levels in their medical fields.
They then had a few children including me, and now I'm the only child left "standing" because my sisters turned into classic "Southern Belles" and once the cash flow stopped from the folks they quit coming around. My brother turned to booze and the bottle, thinking partying is the only true answer. It's just depressing that out of the 4 children who had the same education and upbringing, I'm pretty much the only one in the generation that "gets" the concept of finance and money.
My sisters and brother? Literally no work ethic. They are literally proud to scrape by, avoid holding a job, and avoid helping our aging parents. But the sisters demanded the most lavish things and weddings, and the brother expected that my father and I would have infinite resources to keep bailing his ass out of trouble.
It is no surprise that I've maintained a healthy relationship with my parents and family, while they've continued to seek the next quick buck in their lives.
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#7Where does the 70% of families lose their wealth statistic come from?
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#8Luck. Model an agent that has some odds of doubling wealth, maintaining wealth, or halving wealth per iteration of some game. It's easy to generate downward trends.
Re: Why Do 70% of Families Lose Their Wealth in the 2nd Generation? (2018)
#9> The third generation never realizes the struggles and sacrifices the previous generations endured. The only thing they know if a life of plenty and have a real lack of understanding of what is needed to create and maintain the lifestyle they have grown accustom to.
Having made this perfectly valid point, the article seems to ignore it from that point on. Yes,that is the problem but can you fix it?