The wisdom of wealth: Our gift to future generations

As Australia’s population ages, we are rapidly approaching what some are calling the “great intergenerational wealth transfer”, which is set to become the largest in our history.

The figures are staggering; about $100.2 trillion in assets worldwide is expected to shift from the estates of baby boomers – those born between 1946 and 1964 – to their heirs in the next 20-30 years. This will mostly be in the form of residential property, unspent superannuation funds and other investment assets bequeathed to family beneficiaries.

On paper, that’s a lot of money set to rest on some young shoulders.

Knowledge is power. Wisdom is wealth.

I came to Australia armed with a dream and desire to build a great life for myself and my family, and as a migrant, I instinctively knew that working harder and smarter was going to be key to any success I may obtain.

I was never ever content to go along with the pack and fit into what was expected of me at the time (which was to get a steady, ‘safe’ job on a factory floor or the kitchen of a Chinese restaurant and earn just enough to get by.)

Instead I chose the road less travelled, a riskier path of commission-based sales, which required me to learn everything – a new language, a new culture and a new job – fast.

What I lacked in experience I made up for in my thirst for knowledge and hard work, a thirst that remains with me to this day.

Gaining knowledge gives us a certain power and a freedom to make more informed choices about our future, and the future of our children.

Most parents have dreams that their children experience a better quality of life than themselves. I grew up watching my parents working long hours 7 days a week, spending all their incomes on family and helping relatives with little to show for it. This instilled in me a strong motivation to work hard and do everything I could to give myself, my parents and my own family a much better life.

Thanks to the choices and sacrifices my wife and I have made over the years, our children are lucky enough to be living a lifestyle where lack of money is not an issue.

So how do we give them the motivation to strive for their own dreams and create their own wealth?

This where wisdom comes into play.

As parents, I believe it is our job to teach our children the importance of financial responsibility, social responsibility and the true value of hard work.

At a very young age, my wife and I started teaching our children about what it means to have a wealth mindset. Simple things such as putting 10% of everything they earned – be it Christmas cash gifts from relatives or pocket money – into an investment account.

Encouraging them to go out on their own and get a part-time job (my son waiting tables at a local Chinese restaurant when he was a teenager), discussing age-appropriate financial topics at the dinner table, all of these things we believe are aspects of ‘intergenerational wisdom’ we can pass onto our children.

We also teach them the importance of having a purpose and goal in life, which is paramount in this age of social media where kids are placing so much value on short term material possessions.

The richness of happiness

It’s a given that we want our children to be happy and healthy. And while it’s a clique that money does not always contribute to happiness, it can instil a sense of pride and accomplishment when it is hard-earned.

When children inherit money and have yet to be taught about financial responsibility, there’s a sense that they haven’t earnt it, which can lead to a more careless approach to life in general.

(How many times have we read about wealthy kids ending up in trouble because they are given so much, and think they have nothing to strive for?)

No matter how much money we’re talking about, the principles of adopting the money mindset are invaluable as they teach us about setting goals, dreaming big and celebrating even the smallest wins. It’s important for us as parents to empower our children with the financial knowledge, education and motivation to forge their own path.

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