May 2025
A study conducted by the Williams Group found that 70% of wealthy families lose their fortunes by the second generation. 90% lose their fortunes by the third generation.
I read about this study in Harmon Kong's book, Values over Valuables. I was alarmed but not surprised. There are many stories of beneficiaries who have inherited wealth but failed to inherit their benefactors’ work ethic and values. Having more money doesn’t make good or bad habits go away. And money does not mend relationships. Bad habits and bad relationships get compounded by having more money and so in these situations, yes, the family fortunes are likely to be lost.
Harmon’s book encouraged me to think more deeply about my life. My wife and I save for our boys, and we do have them as beneficiaries in our will. But what are we passing on to our sons? Are we teaching them lifelong lessons and values? And as they observe me, are they learning what a life-giving relationship looks like? Or do they see my attention absorbed by my phone?
Some actions my wife and I are taking (imperfectly):
1. Using simple repeatable statements to identify and instill our family values. For instance:
- “Be a Blessing”
- “Apologize and forgive”
- “Manners matter”
- “Contentment is a choice"
2. Exercising those values together:
- Giving my sons chores and reminding them that they’re contributors to our family
- Nudging my boys to say good morning and please and thank you
- Delaying gratification and exercising self-control. “Yes, we can Google the answer to your question, but let’s wait till we go to the library to find a book about this topic. Or let’s ask your grandpa – he knows a lot about gardening.”
- Having my older son put $5 bill in the offering plate and having both boys volunteer with us
3. Having conversations about money:
- It is a tool, it can be a blessing or a curse, and it is a limited resource
- Money is not a magical item that lives on a phone. You need to work to earn money but you also need to rest. And even if you earned the money, it is not yours
- Seeing other people with more stuff or nicer stuff does not mean they have more wealth and/or more happiness
- We spend our money differently because we have different values. And our values are..