The Right Age to Start Teaching Next Gen About Wealth — Susan Schoenfeld
Susan R. Schoenfeld, CEO and Founder of Wealth Legacy Advisors LLC serves as a ‘thought partner’ to families of wealth through personal attention and human spirit. Susan is an award-winning Thought Leader; she provides guidance on legacy, next-generation, stewardship, governance, leadership succession, and philanthropy. She recently spoke on Family Office Structures at Opal Group’s Family Office Forum West.
The right age to start teaching the next generation about wealth was yesterday. You can’t start yesterday, so start today!
It’s the age-old questions of how much do we give our kids, and when? And how much do we tell our kids about our family’s wealth, and when? Those two questions are the ones that, in my experience, do keep parents of wealth up at night.
There are age-appropriate ways to start shaping attitudes about wealth and money in even young children. One way is as simple as deciding whether to give children an allowance.
My 3 rules of thumb with allowances are, first, be consistent. If you decide to give an allowance, it can’t just be when you remember it, but it must be on a regular schedule.
Second, my philosophy is that an allowance should not be a reward for doing chores; I think that chores are part of one’s responsibility as a member of the family, and a child doesn’t do them because they get paid at the end, they do them because, for example, one person runs the family foundation, and one person maybe does the food shopping and one person maybe takes out the garbage or whatever. And every family member must do their chores as well. I believe that not linking the chores to the allowance is critical to building a sense of family responsibility.
Third, the main benefit of allowances is helping to teach the next generation to distinguish between wants and needs. I’m sure many of you know the three-jar concept of allowances: the Spend jar, the Give jar, and the Save jar. The parents encourage their kids to divide their allowance among the three jars. The nature of delayed gratification in the Save jar is, maybe I don’t have enough to buy that video game or that app today, but if I save up my allowance for a couple of weeks, I’ll be able to do it. With the Give jar, the idea there is to make it a clear jar, so that the children can see that clear jar growing, if that’s part of your family value system. And then you can choose to match what your child puts in, so they can see that Give jar growing exponentially. That technique is one that works particularly well with even little kids, because it is so visual.
With teenagers, one way to start teaching them about the family’s wealth is to invite them into the family office either as an after-school job or a summer job, and help encourage them to learn more about the family story, the family history, the family work ethic, the family culture, and to learn about the family office.
So those are some age-appropriate ways to get more children involved and engaged at different ages, and teaching them the family’s story and culture.
Susan Schoenfeld, a public speaker & thought partner to families of wealth and their advisors, is an award-winning thought leader. Susan’s switch from successful estate planning attorney and CPA to a trusted family advisor and thought partner was inspired by families of wealth asking her to search questions beyond estate tax planning. As a conflict-free advisor who provides no investment, tax, or legal advice and sells no product, Susan shares her insights directly with wealthy families and with financial services experts. She is active as a keynote speaker and a leader of break-out sessions and workshops at conferences throughout the US.
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