There's a term making it's way around kitchen table and water cooler discussions more and more. That term is "generational wealth." It can be talked about positively or negatively. Let's explore that idea a bit today.
Sometimes, the term "generational wealth" is mentioned to invoke the thought of money that has been saved by previous generations and continually passed on to children and grandchildren. This way, the children have what is thought of as an "easier" time with life because they supposedly have plenty of money.
Generational wealth can take several forms. For instance, some generational wealth is held in real estate. Buildings that have been owned by the same family for many, many years. Real estate like this can generate passive income when managed well through rent payments. It can indeed help future generations live better with that income. However, if mismanaged, that wealth can be squandered and then it no longer exists to benefit those who inherited it.
Generational wealth is also referred to in an almost derogatory sense at times. Some people wish so heavily that their lives were made easier through such inheritances that they begin to resent those that do. In addition to being unhealthy, this thinking prevents you from looking for ways to build your own generational wealth to pass down. You are less able and likely to help provide that kind of blessing to your own descendants.
One thing to remember about generational wealth is that it usually takes generations to build!
Perhaps a grandparent or great-grandparent steadfastly saved money in long-term investments. They may have never had a chance to reap those benefits because they saved them for future generations. It then fell to the next member of the family to steward that blessing well. Not just for their own benefit, but for the benefit of their own children and grandchildren.
Rather than falling into the trap of looking at investments like that as ways to enjoy our own lives more, perhaps we should be looking to enjoy the blessing while preserving it for the future. Do we not honor our forbearers' memory when we do so?
When we have built our own strong money habits, our own sturdy Money House, we pay that honor to those forbearers. Not only do we help make our own lives better and more secure financially, we have the opportunity to continue a strong legacy. If not to continue, we have the opportunity to start building one ourselves.