Planning for Generational Wealth: A Guide for First-Generation Wealth Creators
Congratulations—you’ve done what few people ever achieve. Whether through entrepreneurship, investing, or professional excellence, you've built significant wealth. But creating wealth is only the beginning. The real challenge? Keeping it.
For first-generation wealth creators, planning for generational wealth can feel unfamiliar or even uncomfortable. You're used to being the builder, not the steward. But without intentional planning, wealth often evaporates within just a couple of generations.
In this guide, we’ll break down what generational wealth really means—and how you can begin laying the foundation today.
The Harsh Truth: Most Wealth Doesn’t Last
The old adage goes:
“Shirtsleeves to shirtsleeves in three generations.”
And the data backs it up:
70% of wealthy families lose their wealth by the second generation.
90% by the third.
The reasons? A lack of preparation, poor communication, no shared values, and no strategic plan.
But it doesn’t have to be that way.
What Is Generational Wealth, Really?
Generational wealth isn’t just about passing down money—it’s about passing down a mindset, a mission, and a set of tools that future generations can use to thrive. This includes:
Financial assets (investments, real estate, business interests)
Legal and tax structures (trusts, estates, family offices)
Education and values
Governance systems
A clear vision of what the wealth is for
The 5 Key Pillars of Generational Wealth Planning
1. Get Clear on Your “Why”
What is this wealth for? Is it to fund education? Philanthropy? Business creation? A secure lifestyle? Without a clear purpose, money becomes a source of confusion, not clarity.
Action Step:
Define your wealth mission statement. Share it with your advisors and family.
2. Build the Right Structures
Trusts, holding companies, family limited partnerships, and estate plans are tools—not goals. They need to reflect your intentions and protect assets across generations.
Action Step:
Work with a private wealth strategist, estate attorney, and tax advisor to set up a customized structure that supports long-term preservation and flexibility.
3. Educate the Next Generation
Financial literacy and values are not inherited—they must be taught. Heirs who don’t understand money often fear it, misuse it, or lose it.
Action Step:
Begin age-appropriate financial education early. Bring the next generation into family meetings, philanthropy decisions, or investing conversations.
4. Establish Family Governance
Generational wealth requires a system for making decisions, resolving conflict, and staying aligned—especially as the family tree grows more complex.
Action Step:
Set up a family constitution or charter, create a family council, and hold regular family meetings. Consider a neutral facilitator to guide the process.
5. Review and Adapt Over Time
The best wealth plans are living documents. They adapt as your family evolves, laws change, and new priorities emerge.
Action Step:
Conduct an annual wealth review with your advisory team. Revisit goals, update structures, and reassess risks.
Common Mistakes First-Generation Wealth Creators Make
Thinking "I’ll do this later"—delaying planning often closes doors.
Keeping wealth a secret from children—this breeds distrust, not humility.
Assuming money will “teach” kids what hardship taught you.
Treating wealth like a reward instead of a responsibility.
Not having a trusted advisor to coordinate the big picture.
Final Thoughts: You’re Not Just Building Wealth—You’re Building a Legacy
As a first-generation wealth creator, you’ve already done the hard part: you’ve created something meaningful from the ground up. But if you want your wealth to outlive you, you must move from builder to architect of the future.
Generational wealth doesn't happen by accident. It requires clarity, intention, and the right team behind you.
Are you ready to move from wealth creation to wealth stewardship?
Start building your generational plan—your future family will thank you for it.
