Savings case studyShutterstock The Hague – Poor people may lie awake at night worrying about their own and their kids’ survival. However, rich people do the same – not because of a lack of money, but because of having too much.
A report by the American law firm Withersworldwide shows that rich people worry that all their money may ruin their children. Altogether 4 500 people with incomes of $10m and more were surveyed together with members of 16 super-rich families in Europe.
According to the report, entitled The Meaning of Wealth in the 21st Century, for many rich parents “the main concern is that great wealth will scotch the individual ambition in their children”.
The report comes to the conclusion that great family wealth only rarely survives three generations.
According to European newspapers, Sara McCormack, a partner at Withersworldwide, explained: “If the first generation are wealth creators, then the second generation tend to be wealth preservers, but it is the third generation that families are most worried about.
"If they have had everything put on a plate for them without seeing any of the hard graft that goes into creating that wealth, then they can lose track of how best to use that wealth and how difficult it was to build up in the first place.”
European newspapers cite several well-known super-rich who have told their children that they will not be inheriting their parents’ great wealth.
Singer Sting told the London Daily Mail that he would not pass on his fortune of £180m to his children. Rather, they should earn their money themselves.
“I told them there won’t be much money left because we are spending it! We have a lot of commitments. What comes in, we spend, and there isn’t much left.
“I certainly don’t want to leave them trust funds that are albatrosses round their necks.
"They have to work....Obviously, if they were in trouble I would help them, but I’ve never really had to do that. They have the work ethic that makes them want to succeed on their own merit.”
Celebrity chef Nigella Lawson concurred. And Brooklyn Beckham, daughter of David and Victoria Beckham (worth £165m) recently got a job with a West End coffee shop, earning £2.68 per hour.
McCormack said just having large amounts to invest “is not enough to provide purpose of cohesion to the broader family group”.
For families living off investments, wealth is a great source of tension.
While some of the super-rich begin new businesses, others use charitable causes to give the family a renewed sense of common purpose, she added.
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