Let's talk about Generational Wealth - 11/10/2023
What is Generational Wealth? Generational wealth is any assets that are passed down from one generation to the next. We typically think of this as assets that transfer at the passing of the prior generation, but it also includes education, support, and other opportunities that are passed down throughout a lifetime.
Who has generational wealth? To some extent, we all do, based on whatever support our family gifts to us during their lifetime. But it is most noticeable and beneficial the larger the assets are.
How can you build generational wealth? You build generational wealth the same way you build personal wealth - sometimes by making the hard decisions of what not to buy, sometimes by taking calculated risks on personal or financial investments,
How can you keep generational wealth? There have been studies that show generational wealth doesn't last forever, supposedly around 90% of generational wealth is lost by the third generation. It is important for both growth and maintenance of wealth that people are financially educated and aware. That means having conversations about money and making connections with financial advisors.
Why is generational wealth considered an issue for marginalized populations? Due to historic limitations of opportunities and resources because of discrimination and exclusion, marginalized populations may not have the history, knowledge, and other resources that are created by having wealth. This makes it more difficult to build wealth and puts them at a disadvantage even considering the three year cycle of generational financial wealth.
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