Rich People and Their Kids

[Habitual readers of BMA know that I belong to an obscure sect that prohibits blogging on Thursdays. I realize that leaves many of you with time to kill and that some of you have not yet read every one of the 317 posts I’ve lovingly hand-crafted for your enjoyment. So today I inaugurate what may become a regular habit: The Thursday Rerun.

Today’s originally ran July 27, 2009.]

Friday’s edition of Wealth Matters in the New York Times told us about the children of rich people. Turns out that if you are rich enough, instead of just Toddler Cart Crop - Remi  Jouan relying on your spouse, you can hire somebody to tell you what a lousy parent you are.

One of the several intriguing things about Wealth Matters is that the author apparently doesn’t know any rich people, or at least none that will allow him  to quote them. Instead, the columns seem to be written based on talking to people who talk to rich people. Or so they claim.

Sources for this week’s installment include a partner at a consultancy called Relative Solutions which "works with family businesses" and a partner at "BBR Partners, an adviser to ultra-high-net-worth clients." I suppose that both are keen to be quoted because they hope potential clients will read the column. I’m not sure that’s a sound business strategy.

What these advisors to the rich reveal is that if you’ve got so much money that your kids will never need to work for a living, it is hard to get them to work for a living. Good to know.

The Millionaire Next Door discussed this problem, sorta. It spilled a lot of ink on the dangers of giving your kids money. I think the subtext was that if you give the money away you won’t have it anymore, and that is a bad thing, but the authors also went on at length about the crippling effects of unearned money.

On the other hand, Wealth Matters seems to be swimming against the popular personal financial wisdom tide. Don’t rich parents habitually pass on the secrets of the ways of money to their offspring? And how can it be that there are consultants to help the rich deal with money issues like these? Didn’t they get rich because they are skilled at such things?

When I was growing up I knew a kid who worked every summer in high school, doing the sort of just-above-minimum-wage jobs you’d expect an earnest teenager to do. Most the rest of us weren’t so earnest. One day this guy mentioned how annoying it was that he got to keep less than half of what he earned.

It hadn’t really occurred to me until he brought it up, but this kid’s family was quite rich. He had a trust fund that put him into the top tax bracket, which in those days was north of 50%. Nevertheless, his parents made him go out and get a job every summer, because it was the right thing to do.

When I was young I thought this was an example of great parenting. Now I am not so sure. Granted, my kids are in absolutely no danger of not having to work for a living as adults, so for me this is merely an academic question. (As it is, I suspect, for just about all readers of the Wealth Matters column.)

Idealistic notions of work as personal fulfillment aside, just about everybody works for the money. Some of us may not be making as much as we possibly could, preferring to do something a little more pleasant or fun than the income-maximizing job, but I don’t know anybody who would keep doing what they do if they weren’t paid to do it, even if they didn’t need the money.

Is training your children to believe that working every day is the right thing to do, even if you don’t need to, a good idea? I’m not so sure. Raising them to think that work is not about money seems like begging them to make poor career choices later on. And teaching them that they never need to worry about money when, like just about everybody else, they most certainly do, is a disaster waiting to happen.

Like most parenting issues, my take on this is to avoid over-thinking it. Money and work are what they are. With age-appropriate details, I plan to tell my kids the facts as I know them. Here’s where the money comes from, there’s where it goes. If you want to live well, expect to work hard. They’re bright kids. They’ll figure it out.

[Photo – Remi Jouan]

No Comments

  • By paul, July 15, 2010 @ 6:26 pm

    Not sure I totally agree with you on your post. I think the idea of living the majority of your life working in a job with no enjoyment of what you do just to make money is sad. In my opinion it should be to live your life working at something that is a passion. A lot of people may say” its not that easy, you have responsibilities”….. Agree, but most if not all of our responsibilities are chosen. I want to teach my children to be held accountable for there choices and to live and work with passion and in something they enjoy, not just for money. Living well doesn’t mean making a ton of money……

  • By Hibryd, July 16, 2010 @ 8:09 pm

    The biggest benefit of making kids work as teenagers, even if they don’t have to, isn’t the money. It’s the experience of being behind a counter and getting to enjoy the kind of abuse people deal out only to cashiers and other wage slaves. It teaches them that no, the customer is not always right, and no, it’s not adorable when a kid makes a mess in the store. It teaches them that some bosses are assholes and some problems should just be ignored. Basically, working a wage slave job gives you *perspective*.

  • By Hibryd, July 16, 2010 @ 8:12 pm

    Plus, if they end up in food service, they’ll learn why you should 1) tip well, and 2) never mess with the people handling their food. Lessons that have escaped the vast majority of the adult population.

  • By Jack, July 17, 2010 @ 5:08 pm

    I agree with Paul that one must have passion for work. Otherwise that person’s life will be pathetic. But there are other ways to teach children about money. A great resource that I have used with my kids is the Finance for Kidz Series by Professor Prakash Dheeriya. You can check out his books at finance4kidz My children have benefited tremendously from reading those books. Now they don’t tell me that they want this and that, but know what to ask for and when and how money is tied in throughout their day.

  • By Sue, July 21, 2010 @ 7:54 pm

    What bizarre sect??

  • By Carlik, June 17, 2011 @ 3:23 pm

    I think it truly depends on what the values of the parent are. Whether you show it intentionally or not, your values will become evident in your in your daily behavior.

    I believe that since there are many things in life that are simply a matter of preference, and not right and wrong, that any person who has clearly defined values, understands them, and seeks to instill them into their child is an excellent parent.

    If you love fishing, why not fish with your son or daughter. If you love working with your hands, they should be right under your arms watching you. Share your world with your child, and become one with them.

Other Links to this Post

RSS feed for comments on this post. TrackBack URI

Leave a comment

WordPress Themes