The Rising Generation: Finding Yourself in the Shadow of Family Wealth

Why “Rising”

Most family-office advisers and family members focus their attention on the parents or grandparents, because people take it for granted that whoever holds the wealth calls the shots. Usually it is the older generation that holds the wealth—the generation that has already reached the summit of the family’s authority.

Incidentally, if you are a family-office adviser, ask yourself three questions: (1) Who pays my fees? (2) Who do I consider my client? (3) Who speaks up for the growth and well-being of the rising generation? If the answer to the first two questions is “the older generation,” and the answer to the third is “no one,” then the family you serve will come to a sad end. That family is also unlikely to become your long-term client.

If you are a member of a family’s growing generation, you should build your confidence: you are the future of this family. You hold the key to the family’s true wealth.

This is why we use the word “rising.” Ordinarily, people use the term “next generation” to describe the young members of a family that holds wealth or a family enterprise. We suggest not using “next generation” when speaking of intergenerational relationships. “Next generation” places the emphasis on the sequential order of the generations—that the parents are the wealth creators, they are the ones who matter, and everyone else is merely “next.”

By contrast, we believe every generation has its own calling. Every generation has the capacity to rise, and this capacity is most evident in the young—those in their twenties and thirties. But “rising” need not be confined to age or to a particular era (millennials or Generation X, for instance). At the same time, sometimes—especially in wealthy families—people in their forties, fifties, or sixties have never had the chance to fully establish their own identity, yet they too have the opportunity to rise.

The Pull of the Black Hole

Rising and growing are a very important part of life, whether or not you live in a wealthy household. But sometimes the presence of great wealth can instead become an obstacle to rising. We use the name “black hole” to describe this source of danger. If you come from a very wealthy family, look back over your past. Was there one person who, as the creator of the family’s wealth, held great prestige? Does your family tell the story of that person’s hardship and success? Do his or her values and views dominate family decisions? Do his or her decisions about trusts or partnerships still shape family members’ lifestyle choices? If so, your family’s situation is not unusual. Most wealthy families have an indispensable figure—the one who forged the family’s wealth. Such a founder and his or her dream can become the sun of the entire family, shining upon its members, bringing about success and eminence, giving the family a sense of belonging and glory.

But at the same time, it is precisely this successful founder and his or her dream that we call the “black hole.” Because before this person’s achievements and dreams, everyone else in the family—generation after generation—seems to become insignificant.

The fundamental question, then, that any rising generation faces is this: “How can I escape the gravity of the black hole, build my own sense of identity, and pursue my own dream?”

The Challenge

The problem the black hole creates requires a psychological solution, and that solution is captured in the phrase “finding yourself.” It means building your own sense of identity, with skills, knowledge, character, and purpose. It means separating your own identity from those of the founder, your parents, your mentors, and others who have had an important influence on your life.

“Finding yourself” takes place against the backdrop of life’s stages. We have summarized the psychoanalyst Erik Erikson’s description of the main stages of life. We can map these stages onto the development of a family member’s identity within the family; each stage describes a dilemma and the activity characteristic of coping with that dilemma:

1. Infancy: Trust vs. Mistrust. Needs the greatest comfort and the least uncertainty in order to trust oneself, others, and the environment.

2. Toddlerhood: Autonomy vs. Doubt. Strives to master the physical environment while maintaining self-esteem.

3. Preschool age: Initiative vs. Guilt. Begins to initiate activities rather than imitate them, and develops conscience and gender identity.

4. School age: Industry vs. Inferiority. Tries to cultivate a sense of self-worth by improving skills.

5. Adolescence: Identity vs. Role Confusion. Under the pressure of role models and peers, tries to integrate many roles (child, sibling, student, athlete, worker) into a single self-image.

6. Young adulthood: Intimacy vs. Isolation. As a spouse or partner, learns to make personal commitments to others.

7. Middle age: Generativity vs. Stagnation. Seeks fulfillment through creativity in career, family, and social interests.

8. Old age: Integrity vs. Regret. Reviews a lifetime of achievements, comes to terms with regrets, and prepares to meet death.

Looking across the stages, you can ask yourself these questions:

• Which stage of life development are you in now?
• Which developmental stage are your important family members in?
• At your current developmental stage, what particular challenges have you encountered?
• In the past, what did you do that was most helpful to the transitions in your life?
• If you kept doing something, what would help you enjoy your current life more?
• If you stopped doing something, what would help you enjoy your current life more?
• If you started doing something, what would help you enjoy your current life more?

Finding yourself is an activity that spans several life stages, especially from childhood to middle age. Very importantly, finding yourself does not mean individualism—losing all connection with your family and its other members. On the contrary, it means maintaining mature connections with others. It includes both separation and connection, or a balance of independence and interdependence. This is the balance every one of us must find, whether wealthy or not. It is a fundamental life challenge.

Into this fundamental life challenge, add the special factor, or special need, of family wealth. Family financial capital has a way of emphasizing interdependence. If your parents are successful, escaping their shadow can be difficult. If your family is famous, building your own name can be hard. If you grow up with the support of trusts and enterprises, you may find it hard to make your own choices about the things that matter in your life.

In fact, at different stages of your life, dreams will appropriately loom large at some stages and shrink at others. Whatever challenges you meet, they cannot fully disappear, and should not fully disappear.

Many rising-generation members tell us their parents worry they will become self-important. But the real cause of self-importance is the rising generation’s failure to find itself. At the heart of self-importance is not seeing oneself as a capable, independent person. Finding yourself is the antidote to self-importance.

Meeting the Challenge

Growth is a lifelong lesson. The following two pieces of advice can help you begin this journey:

1. Ask yourself: in what situations do I feel genuinely in control, actively committed, glad to be challenged, and in harmony with others (community)? These “4Cs”—Control, Commitment, Challenge, Community—point to a requirement for self-awareness and self-growth.

2. Next, think about what you are good at. What do you value in yourself? In what areas have you achieved the greatest success? You get to decide what success means. Once you have identified these, look for the reasons behind them: what strengths let you enjoy this success?

These questions aim at self-knowledge. But self-knowledge comes not only from reflection; for some people, it can also come from action. It is very important to examine self-knowledge in practice. We find that the most important areas for such examination are work, relationships, and communication (especially with other family members, including parents). If our experience has taught us anything about the danger signs in families with great wealth, it is this: children grow up without any real sense of accomplishment, without lasting and trustworthy relationships, and without open and sincere communication within the family.

Below is a brief discussion of the key points on work, relationships, and communication during the growing stage.

On work: look for an activity that challenges you, tests your abilities, requires your dedication, and genuinely meets the needs of others. This work can be paid or voluntary, part-time or full-time. The key is that, through the process of at least to some degree committing to meeting others’ needs, we come to understand our own strengths and advantages.

If you grew up in a business environment controlled by your family, you may have great motivation to enter that industry. This can be a wonderful experience, but we suggest pursuing it only after you have had significant experiences elsewhere—say, three to five years at the start, tempering your abilities and growing through work in other places. You will encounter and learn skills and knowledge you might not have gotten at home, making you more valuable to the family enterprise in the future. Moreover, you (and your family) will never have to worry about whether you can live independently after leaving the family.

As for relationships, we suggest that the rising generation (or any generation) build good relationships with people who:

• Recognize your strengths.
• Share your dreams.
• Are positive and optimistic.
• Challenge you and inspire you to be the best you can be.

Think about your own close friendships or other relationships. Do your friends or partner have these traits? The concern most often expressed by rising-generation members of wealthy families is that they fear a future friend or partner will value only their wealth. This is a legitimate concern. The response to this challenge is not to hide your wealth, and still less to flaunt it, but to assess your future friends beyond wealth. If they can do the four things above, you will together find the way of relating that suits you best.

Finally, when it comes to communication about wealth within the family, there are a few things to consider:

Acknowledge that talking about family wealth is hard, but don’t wait for your parents or grandparents to bring it up. They may not know how to, either.

Think about what you want to learn, and why. Try to make your questions as specific as possible—for example: “What expectations do you have for how I will use any inheritance I might receive?” “What are your hopes for me regarding work and income, saving and spending?” “Do you hope I will join the family enterprise, or, having received part of the family’s financial capital, continue or open up some other endeavor?”

Think about how best to communicate with your parents or grandparents. One-on-one? In the context of a family meeting? Or with a written note first, so they can think it over beforehand?

To stress it again, work, relationships, and communication are the three areas where we see the rising generation truly discover its strengths, weaknesses, and areas for growth. It is from these activities and self-reflection that something truly fundamental and important arises: a clear awareness of one’s own dream. We hear many parents tell us, “I don’t know what my child’s dream is.” And we hear many rising-generation members say, “I haven’t found my dream yet!” Sometimes this over-emphasis on dreams can become a burden. If a person’s dream is not very clear, they may feel like a failure. Our experience is that dreams only become clear over time, through effort, and through the ongoing action of growth and exploration. They are almost never clear at the beginning of the process.

In Closing

Actively taking charge of your own life may require a bigger step—leaving a suffocating career or relationship, for instance. Whatever the situation, you must ask yourself whether you are living your own life or the life you think others want you to live. To that end, it can help to seek the support and insight of people in the same situation. These people might be other family members, such as siblings or cousins. They might be members of other families with great wealth, whom you can meet through membership organizations, charities, or the like. Engage more actively with them in exchanging ideas, learning, and decision-making.

Regarding your own life, all you can do is “choose the path you believe is best.” How others judge your choices, how others see themselves—whether they like it or dislike it—that is their task, not yours, and something you simply cannot control.

I believe the meaning of wealth is to help a person find and realize the meaning of their own life. And the meaning of family wealth is to help every member of the family find and realize the meaning of their own life.

This article draws on the book Complete Family Wealth, which Flourishing Tree Family Office has acquired and translated; the Chinese edition is forthcoming—please stay tuned.