The concept of generational wealth is evolving. In the past, it was often associated with “old money” or “trust-fund families.” Today, with rising financial awareness and more accessible financial tools, generational wealth is increasingly central to building a lasting family legacy that goes beyond dollars and cents.
At Magellan Financial, we believe generational wealth should be the fabric of your family’s legacy. That means encompassing financial preparedness, yes, but also connections, experiences, and shared values. By redefining wealth as multifaceted, families can create a meaningful and enduring impact that enriches both current and future generations. In other words: generational wealth.
The Challenge of Preserving Wealth
The journey of preserving family wealth is not without obstacles. Research shows that roughly 70% of inherited wealth disappears by the second generation and 90% by the third.¹ This sobering reality highlights the importance of a comprehensive strategy that blends financial literacy with emotional intelligence.
It’s not just about transferring money. It’s ALSO about instilling the principles, confidence, and resilience needed for stewardship. Successful families go beyond traditional planning by emphasizing values, open communication, and education. Many hold regular meetings to discuss investments, charitable giving, and long-term goals, helping younger generations understand not just the “what” but the “why.” These conversations often prove as valuable as the documents themselves.
The Transformative Power of Family Wealth
When wealth is managed with foresight, its benefits can be life-changing. Passing down not only financial assets but also wisdom, resilience, and a shared vision best positions future generations to thrive. This holistic approach to generational wealth fosters the mindset that extends beyond money and into opportunities for growth and contribution.
The psychological advantages are equally important. A strong family value system, paired with financial preparedness, gives younger generations the confidence to pursue ambitious goals, whether in business, philanthropy, or personal development. Families that blend money with meaning often see stronger bonds and reduced conflict around inheritance. At Magellan Financial, we work with families to nurture this balance, helping wealth become a tool for empowerment rather than division.
The Significance of Shared Values to Generational Wealth
Core values such as hard work, education, and service to others provide an anchor for wealth stewardship. When these values are clearly articulated and modeled, they become a compass that guides financial decisions across generations. Teaching financial literacy alongside lessons in physical and emotional wellness helps younger generations see wealth as more than numbers on a page. It becomes part of a larger life philosophy.
This is where family offices and long-term planning services are essential. As outlined in our Family Office Services, integrating financial strategy with legacy planning allows families to preserve both material and non-material assets. It helps ensure that wealth remains aligned with the family’s mission and continues to provide meaning, not just money, over time.
Strategies for Nurturing Wealth Beyond Finances
To cultivate wealth fully, families should embrace strategies beyond finances, focusing on relationships, health, and purpose. Wealth evolves across life stages and must stay aligned with values and goals. As we note in Introducing the 4 Phases of Wealth Management, stewardship is never static but requires adapting as circumstances and generations change.
- Prioritize Relationships: Strong bonds with family, friends, and community build “emotional wealth” that outlasts money. Hosting family traditions, retreats, or charitable initiatives can provide shared experiences that reinforce values.
- Focus on Health and Wellness: True prosperity includes mental and physical well-being. Regular investments in exercise, nutrition, and mindfulness create a foundation that money alone cannot buy. A healthy family is better equipped to enjoy and manage wealth.
- Pursue Experiences: Shared experiences, whether travel, education, or hobbies, create memories more valuable than possessions. These experiences often shape identity and perspective, fostering resilience and gratitude.
- Commit to Personal Growth: Continued learning and passion projects foster fulfillment and adaptability. Whether through advanced degrees, entrepreneurial pursuits, or creative outlets, personal growth strengthens the family unit.
- Live on Your Terms: Financial independence provides the freedom to shape life authentically. While this journey requires patience and planning, the reward is the ability to make decisions without being bound by external pressures.
By expanding the definition of wealth, families cultivate a legacy that is less vulnerable to erosion and more focused on sustainability.
Generational Wealth: Where to Begin
Establishing generational wealth begins with honest conversations about your family’s values, vision, and priorities. These conversations should be ongoing, not one-time events, and should engage the next generation early so they feel invested and informed.
For families beginning this journey, a good first step is identifying shared goals and documenting them alongside financial strategies. Equally important is carving out time for family dialogue, whether through formal meetings or informal discussions, that reinforces transparency and trust.
Magellan Financial helps families navigate this process by combining wealth planning with legacy-focused strategies. For more insights on building and preserving your family’s wealth, visit the Magellan Financial Insights Blog. There’s no better time than now to start shaping a financial and emotional legacy that lasts. for your generational wealth
Sources:
1 Financial Planning Should Be Intergenerational (Kiplinger, 2023)
Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Magellan Financial Inc. of Heirloom Wealth Advisors is a separate entity from WFAFN.