The idle rich kids out there who are just killing time until they receive an inheritance may be in for a surprise. A recent study by US Trust (which is part of Bank of America) found that, amongst the wealthy, leaving money to the next generation isn’t all that big a priority.
The study measured the attitudes towards wealth of 457 Americans with at least $3 million in liquid assets. The vast majority of respondents (84%) attributed their wealth to their own hard work.
However, just because they had achieved significant wealth didn’t mean they were anxious to share it with their children. When asked about their financial goals for using wealth, less than half listed leaving an inheritance as a priority (in contrast, almost two-thirds identified “travel” as a goal).
For those planning on including their children in their will, only one-third believed that their children would be prepared to handle the inheritance they received. Respondents also didn’t have a lot of faith their children would get along after their death – only 36% believed that their children would be able to work together to manage the family wealth.
Parents were reluctant to share details about their wealth with their children. Only one-third had fully disclosed details of the family wealth to their kids. The reasons for the non-disclosure varied. A primary concern was how the wealth would affect the children’s behaviour – specifically, that they would become lazy, squander their inheritance, develop addictions, or marry a gold digger.
When questioned about at what age their children would be mature enough to manage family money, the responses varied. However, 45% believed it would be sometime after the child had reached 35.
Perhaps growing up with too much money but not receiving a big enough inheritance will be an increasing problem in the future…