What's Wrong with Generational Wealth?

Feb 29, 2024

There is also a podcast version of this article - while predicated on the same story, the podcast is more refined, and if I do say so myself, more interesting to listen to. But, if you prefer to read it, you do you friendo.

Generational wealth has become a buzzword recently, evoking images of financial prosperity, opportunity, and a worry-free existence handed down through the ages. It's today's version of "I'mma be riiiich!" 

I thought I understood the meaning of the phrase - until a pair of recent experiences showed me just how dangerous this phrase, and mindset, can be…

//Names and places have been changed //

Towards the end of the evening, I settle in next to Steve in a dimly lit corner of an intimate gathering for successful entrepreneurs. While some attendees sought networking opportunities, fresh perspectives, or solutions to professional dilemmas, Steve was a part of a contingent that had attended for a different reason. To get unstuck. Despite his outward success, he had been grappling with the same deep-rooted issue since his youth.

This setting enabled our conversation to quickly bypass the usual prerequisite small talk. We sat beside one another, staring off into the middle distance, focusing on nothing in particular, as Steve opened up and poured out his life's story. He revealed a painful past. A self-proclaimed bastard, he was born out of wedlock in the course of what became a tumultuous affair.

Steve's mother was his father's mistress. His father had been an infrequent, but regular, presence in Steve's life - until Steve was five. His father's wife learned of his indiscretion and of his secret second family. Subsequently Steve's father abandoned him and his mother without another visit. As Steve's father disappeared, so too did the money he'd contributed to keeping Steve and his mother's life stable.

This lead to Steve and his mother moving frequently. They lived in shelters and rented single rooms in already cramped apartments as his mother struggled to make ends meet. The specters of homelessness and hunger were constant worries in Steve's life, and he only insinuated at the desperate measures his mother had gone to in order to keep them fed and sheltered. 

Steve's childhood was marred by shame - he shared that it would have been one thing to never know his father. Or if his father had died while he was young. But to be abandoned by a father he'd known and loved for another family, for a "true" family, left a scar on Steve's soul that he had yet to heal. It was further compounded by him being a part of a culture in which familial respect and honor were incredibly important.

He believed himself unworthy of a father, and that his mere existence brought dishonor to himself, his mother, and his father. He believed that, despite his mother's words to the contrary, he was a burden upon her. A reminder of her failure to have a  husband or family of her own. He endured years of torment life this, often contemplating suicide, though he refrained out of the fear that his mother's grief might cause her to do the same. As he reached high school a glimmer of hope emerged as he discovered his talents.

While Steve was not very social in school, he found work across most subjects came naturally to him. He received praise from his teachers, and while he felt deeply unworthy, this praise shone like a dim beacon at the end of a long tunnel of redemption. An opportunity to prove his worthiness and to earn honor through hard work and success.

His journey continued through a prestigious college, on scholarship, and a successful career in finance. He worked in New York in a firm known for long hours and high pay. It wasn't uncommon for his coworkers to average between 60 and 80 hours a week. Steve regularly put in 80 to 100 - a work ethic which hadn't waned, even this late into Steve's 60's. Driven by a feeling of unworthiness he pushed himself further and harder than the others. Over time, he earned a name for himself, collecting promotions and raises as he climbed the ladder before striking out on his own to build what would become a business empire. Despite climbing from deep poverty to wild success, Steve still carried the weight of his shame.

Steve's success wasn't a secret, and in time his father contacted him out of the blue. Steve thought an opportunity for reconciliation might provide him with closure, and release him from the traumatic stigma he continued to bear. Steve agreed to meet for dinner, and in an attempt to show his success and worth, booked it at a costly and highly esteemed restaurant.

Steve never made it to the dinner.

The evening of, his father arrived exceedingly early. Upon seeing him, Steve was overcome with emotions he couldn't control. He asked the hostess to inform his father that he had been called off to deal with an emergency and would be in touch. Steve then ran for the door, and as soon as he exited it, broke down sobbing. When his father called, Steve didn't answer. Nor did he answer the calls that followed. In fact, he confided, he hadn't heard from, or of, his father again until years later when a forgotten Google Alert had informed Steve of his father's passing in a recently published obituary.

Steve paused, and I thought this was where his story ended. This missed opportunity for closure had left him unable to resolve his feelings of unworthiness. After a short pause I prepared to respond, when Steve continued.

Steve had earned more than he could reasonably spend in several lifetimes. By most accounts he was incredible successful. He shared that he was glad he was able to ensure his children would never ensure what he had gone through as a child. They would never flee from shelter to crowded apartment, often going days without a decent meal. In fact, Steve went on, he had also made sure his grand children would receive the same financial support and protection.

"You know what keeps me up at night?" Steve asked me, rhetorically. He didn't know if he had enough to ensure all of his great grandchildren would be financially secure for their lives, or to be able to afford the same for their children. Now nearing 70, his commitment to shield his family from the tragedies that befell him extended well beyond reason. In fact, he shared, the weight of his generational wealth only seemed heavier upon his back for each subsequent generation for which he concerned himself.

This was why Steve was at this event. Not to find closure, or come to peace with the fact that he, himself, had value as a person beyond the circumstances of his birth. But to find ways to bolster his already tremendous fortune to such a degree that he could protect his lineage for generations to follow.

In an attempt to protect his progeny from the world of scarcity in which he was raised, he perpetuated his scarcity mindset, despite now wallowing in abundance. Perhaps the worst of it, obvious to you and I, but still seemingly obscured to him, is the tragic irony of Steve's story. His greatest hurt was his lack of a father. A hurt he unintentionally bequeathed to his family as he missed family dinners and events toiling away long hours at the office. In his quest to spare them, he failed to provide them with the one thing he sought most, a loving and present father figure.

In his telling of his story, Steve alluded to the fact that his children seemed to have little appreciation for how good they had it. And how could they? The inheritance he afforded them simultaneously left them unable to appreciate the generous circumstances in which they had been raised, and his absence caused him to refrain from providing his children the stories and guidance that would give them the perspective and insight to appreciate and wield their privilege appropriately.

It wasn't until months later that I would be made aware of the deep abiding misfortune Steve's mindset had not only on himself and his family, but on society as a whole. I was having a conversation with a friend of mine who works in the field of personalized genomic medicine, who shared an interesting fact with me: After about 6 generations, you are as just as closely related to your direct descendants as you are to a stranger, selected at random, today.

Do you see what I see?

If Steve had extended his personal obligation about two more generations, he'd be financially supporting those no closer related to him than strangers. And, if that is the case, why provide only for your direct descendants when you could also invest in building a better world for everyone to inherit? A world you would be happy not only for your children and their children to inhabit, but for all the future Steves who, by being born into this new and better world, are embraced by society and spared the trauma of Steve's upbringing while still being able to inherit the lessons, insights, and desire to continue building this better world for everyone?

Reflecting on Steve's journey, it's clear that generational wealth is much more than just finances. It encompasses the lessons we impart, the trauma we perpetuate or break free from, and the world we leave behind. Instead of hording wealth like dragons guarding keeps, perhaps we aim to build a society in which we genuinely care for one another so deeply that we see a stranger on the street as nothing less than a distant relative. Perhaps true riches aren't achieved through mere accumulation, but in a longer lasting legacy of designing a more abundant world for all?

Other Notes:

  1. Steve shortchanged his family - it's a classic rag to riches tale. It was the thing Steve hated that gave him the resolve to accomplish what he did. (If you haven't read Outliers, the whole book is about situations like this and a great read/listen.) By giving his family the wealth, without tempering it with the lessons he learned, he truly did them a disservice and vastly left their ability to succeed up to fate rather than intention.

  2. Steve is basically aiming to provide his family with a Universal Basic Income (UBI). But money isn't the only thing required for a UBI to be successful. You also have to have a society and culture that encourages contribution and strives for ongoing improvement. In a sense, we're all trust fund kids.

  3. Steve is a perfect example of why I believe it's important to write down, if only for yourself, how much is enough. I have done this for myself, and I find it is an important anchor. As you find more wealth and opportunity, it can be easy for appetites to grow, or to get caught up attempting to keep up with the Joneses, and find yourself doing the same mental gymnastics as Steve, justifying why you always need more and that no matter what you have, it's never enough.

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Chris Yoko

“However, I continue to try and I continue, indefatigably, to reach out. There’s no way I can single-handedly save the world, or perhaps, even make a perceptible difference… but how ashamed I would be to let a day pass without making one more effort.” - Isaac Asimov

© 2023 Chris Yoko - All rights reserved

Chris Yoko

“However, I continue to try and I continue, indefatigably, to reach out. There’s no way I can single-handedly save the world, or perhaps, even make a perceptible difference… but how ashamed I would be to let a day pass without making one more effort.” - Isaac Asimov

© 2023 Chris Yoko - All rights reserved

Chris Yoko

“However, I continue to try and I continue, indefatigably, to reach out. There’s no way I can single-handedly save the world, or perhaps, even make a perceptible difference… but how ashamed I would be to let a day pass without making one more effort.” - Isaac Asimov

© 2023 Chris Yoko - All rights reserved