When hearing the term Family Wealth, do you just assume a big pile of capital supporting a family? I used to, and frankly, this is the most important component, but it is definitely not the end all be all. However, Family Wealth (notice the capital letters) consists of much more than just money in the bank. Great families through time often start with financial capital, but there are a lot of wealthy families that are long gone and you nor I have ever heard of them. In fact, focusing just on the money component pretty much ensures that the shirtsleeves to shirtsleeves in three generations holds true. We must look beyond the financial in order to build real Family Wealth.
The most efficient way to ensure wealth for your family is to build your career early on. For most, focusing on your career in your 20s will have a substantial payoff. While in your 20s, you likely don’t yet have children or other obligations like aging parents or a big mortgage to pay. And the payoff is a solid foundation to put your earnings capability into overdrive. Your 20s are also the time to take risks, as you’ve got a lifetime ahead of you to make up for any mistakes. Working for the small, but potentially blockbuster company while accepting a lower salary in exchange for greater upside is easy now, but tougher later in life. You can really push yourself to the limits without doing too much damage to yourself or your family.