Life would have been easier if you had graduated college without any debt, wouldn’t it? How we all wish our family had a inheritance that we could benefit from. There would be no need to buy a house or spend money on rent; we have a family house available which we would become the owner as soon as we turn 18, etc… This is the exact moment that we realize the importance of having family wealth.
How did the Waltons or the Rockefellers build wealth so solid that it can sustain over five or more of their generations? Have you ever thought of building a wealth that will allow you to secure your great-grandchildren’s future?
The problem with us is that we do not think long-term. Our only hassle is to get out of debt, save money, travel, or do anything we mere humans do (not the Rockefellers). In this article, we will share with you different ways you could use to grow your wealth…
What Is Generational Wealth?
Before we begin, you must have a clear definition of generational wealth. Generational wealth, also known as family wealth or family legacy, is a commodity left behind by your family or you will leave for your children and grandchildren.
Here I am not talking of leaving behind memories, but we are talking about financial resources.
Here are some examples of generational wealth:
- Real Estate
- Life insurance policies
- Family businesses
- Antiques and heirlooms
- Collectible items
The Importance Of Generational Wealth…
As I said earlier, whenever you are in a financial dilemma, you may fantasize about having family wealth. Still, I guess you throw that thought away, struggling to pay your debt without thinking about building one yourself.
Think it this way, people with generational wealth have a better life. Money does not buy happiness, but it does pay for better health care, top-notch education and high-class neighbourhood… but you do you.
It is not a secret that the wealthy always have a head start, despite the constant clamoring of meritocracy and equal opportunity every day, but that’s a pill hard to swallow.
How To Create Generational Wealth?
1. Invest In Stock Market
The stock market is a way to create wealth over time. Someone who wants to invest in stocks can’t expect to get returns quickly, but the investment is the key if you are looking for a long-term solution. Stocks will grow for decades and can be passed down through generations.
Investing may sound scary, especially if you’ve never done it before. If you are investing for the first time, I recommend you do your research and choose a safe investment . I recommend choosing well-established companies for your first few investments so you can be sure of some level of return.
2. Real Estate Investment
Real estate is another market worth investing in. Most real estate appreciates in value over time provides more opportunities for wealth growth in the long run. Whether it’s stocks or real estate, both are very intimidating but don’t worry; there are several helpful guides available to make it less frightening.
You do need to already have capital, but if you do, real estate is one of the safest investments you can make.
3. Building A Business
If you start a business, the chances are that your children will work within your business. Research has shown that about 30% of family businesses are passed on to the second generation and so on. Imagine building a business so successful that one day your children can take the reins.
This solution is risky and involves a lot of effort because if you don’t already have a business, you will have to build it from scratch, and sometimes the business may fail, or your children may have different interests than you.
If you build a successful business, you should introduce your children to the business at a young age to know how it works and grow interested in it. If you don’t sense an interest in them, you should sell the business to fund a different kind of generational wealth.
If you want to know more methods on how to build your wealth, you should read the part 2 of this article. Let us know in the comments which of these three methods you want to apply?