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Value Creation Blog

8 Ways to Add Wealth to Your Family

Posted by Josh Patrick

8 Strategies to Add Wealth to Your Family.pngAll families have wealth.  For some it’s financial wealth and for others it’s values led wealth.  Still, for others there’s both and for way too many it’s none of the above.

I want you to make sure that you have family wealth and you manage it well. 

I’m lucky.  My father has done an incredible job of managing both in our family.  Through his leadership and wisdom, he’s passed lessons he’s learned to both my sister and myself and through us to our children.  Here are some of the things I’ve learned along the way:

You must talk about your values.

I think values is an important start when you’re having a family conversation about wealth.  If you just look at popular culture you would think we in the United States are as immoral a country that ever existed.  I would argue that for most of us, the opposite is true.

We don’t like it when our leaders exhibit behavior that’s not ethical.  Most of the time when extreme unethical behavior raises its ugly head we go in the opposite direction.  Now, this isn’t true for everyone, but it is true for most people I know.  I bet the same is true for you.

Having a strong sense of right and wrong is an excellent idea.

The conversation about values needs to start with having a sense for what the difference is between behavior that’s right and wrong.  It’s not hard to understand what behavior is wrong.

Here’s a good question for you.  How do you behave when you find that you’ve been undercharged at a restaurant?  Do you tell the server that you owe them more money?  If not, wouldn’t that be considered dishonest at least at some level?

What I learned from not being honest.

I have a very good friend who used to mock me because I wouldn’t let my kids use Napster and pirate other’s music.  He used to think I was a sucker for paying for music and movies I could easily get for free.

He let his son download to his heart’s content.  Fast forward, ten years.  My children have become the type of people I’m very proud of while his child has been in and out of trouble with the law.

Can I blame the Napster incident?  No, and at the same time it’s as my father would say, “The tip of the iceberg.”  Honest is honest and being consistent does pay off in the long run.

You can’t only talk about what’s important once.

Having wealthy habits doesn’t happen because you talk about wealth every once in a while.  It’s a regular conversation and you need to have.  And you need to talk about values in a systematic manner.

If you want something to sink in, you’re going to have to make sure you have conversations on a regular basis with your family.  You say you want your family to save for a rainy day.  Then you better be talking about saving, what it’s done for you and how you’ve done it.  And you better be talking about it on a regular basis.

It’s extremely easy to think that because you say something once, you never have to raise the subject again.  I know that with my family, if I don’t talk about important topics on a regular basis, they never sink in.

Make mistakes part of your family lore.

We all make mistakes.  Most of us like to pretend we never made them.  What do you think would happen if you started to not only talk about your mistakes, but celebrate them as well?

It’s important for your family to know you’re not perfect.  In case you’re curious, they already know it and in too many families’ mistakes are never brought out of the dark closets they live in.  I want you to be different.  I want you to not only talk about your mistakes, I want you to talk about what you’ve learned as well.

Wealth is not just about how much money you have in the bank.

Wealth is not just about what you leave to your kids.  True wealth are the actions you take and the gratitude you show others around you.

When you go out to dinner with your family do you always thank the server when they refill your water glass?  Wouldn’t that just be the kind thing to do?  I bet you would like to be thanked if you were in their situation.

In my opinion wealth is what makes your family unique, not how much money you have.  I’ve seen too many very wealthy families lose their money and develop what I consider poor family values.  Without strong values, it’s hard to have financial wealth stick.  Focus on values and money will follow. 

Your family watches what you do, not just what you say.

If you’ve ever watched a three-year-old they are absolutely focused on what the adults in their lives do.  If they’re kind, there’s a good chance the child will grow up to be kind.

If the child’s parents say one thing and do another, the child learns rapidly to stop listening and start watching.  If you want your family to show the values you think are important, you must live those values.  Consistency is something that your children notice.  Don’t pretend that your actions don’t count, they do.

At the end of the day wealth is a mindset.

Here’s something I want you to consider.  Wealth is a mindset and not the size of your bank account.

I’ve seen people with tons of money who act like they’re poor.  I’ve also seen people with very modest means who live a full life with lots of love.  They live a rich life and money is not their measuring stick for how much wealth they have.

For sure, life is easier with money than without.  I also know that research shows that money stops adding value to your life at about $90,000 of household income per year.  Having more might be nice, but it doesn’t add much when it comes to family happiness.

Do yourself a favor, focus on the non-financial areas of your life and you will be passing a huge amount of wealth to your family.  What do you think?  Are you willing to work on the non-financial part of the wealth management in your life?

Why don’t you leave a comment below and let me know what you think?

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Topics: wealth management, Values, family wealth