Do Your Children Have Wealthy Grandparents? If So, Be Worried

My thesis emanates from seeing many children growing up in an environment of abundance who had no connection to the level of work that was required to gain such material success.

Many of their parents conveyed the right messages about academic success and the correlation with hard work and general success. But, the children would experience life differently.

Great material stuff. No work needed.

To be clear, many of their parents worked reasonably hard. But, the children would soon figure out that the boat, the maid, the 10,000 square foot house were, in part or large part, derived not merely from their parents’ efforts. The teenagers would also note that their car, X Box, and Blackberry “magically” appeared with no connection to the work needed.

In comparison, the students whom I worked with whose parents created wealth had two things going for them:

1) they observed their parents working hard – often very hard – to gain material success and

2) perhaps, more importantly, their parents had the psychological make-up of those striving for success. Such psychological frameworks are naturally conveyed to children.

Here’s the part that hurts some parents. If you and/or your spouse grew up in a household of great wealth, its quite natural that you might not have worked very hard to gain material success. To be clear, many children of wealthy parents work hard and the stereotype of the spoiled millionaire’s kid is way overstated.

But, look around. Some part of your wealth is likely due to the good fortune of having been born into a fortune. You might view yourself as a hard worker but your material abundance is likely not entirely due to the sweat of your brow. You likely incurred no debt for college or graduate school. You may have had help buying your house. You may have been able to start your business because you knew you had a safety net.

And, guess what? Your kids have noticed.

You also might have been considered yourself a kind, giving parent by buying your sixteen year old kid a Porsche. But, what message did you convey? Magical things happen but not due to hard work.

Here’s a crazy parent example from someone who should know better. Sean John Holmes was born in the public housing projects of Harlem. He made his way out of a tough environment – among other things, his drug lord father was gunned down at a young age – and gained admission to Howard University. He then commuted between Washington, DC and New York in order to serve as an intern at Uptown Records. He became Puff Daddy, P. Diddy and now Diddy. Say what you want about him but he certainly worked extremely hard when he started. He’s now worth $340 million. His success largely stemmed from his willingness at a young age to connect hard work to success. In a few years, he might reflect on that fact in conjunction with his recent purchase of his 16 year old son’s first car: a $360,000 Maybach Zeppelin.