How much is considered generational wealth?

[Anonymous]

If that’s what you want to leave to your kids?

[Anonymous]

I don’t think there is a bright line, OP.


$100 would not be considered generational wealth
$100m would be.

So the answer to your question lies somewhere in between.

[Anonymous]

In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

[Anonymous]

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

[Anonymous]

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

I definitely see this perspective but would counter that your children leaving college debt free allows them to save money for a house or to invest in a business, which will build enormous wealth, and if you pay off your mortgage faster its not as though you are going to stop earning (I assume), so that money will go into savings for the next generation to pay off college, etc -- it does have reverberations across your future generations. Not having student debt is a HUGE advantage for young people to set themselves up for financial success. But, that said, I hear ya - no one is going to be dropping out of the workforce to sail around the world.

[Anonymous]

Generational wealth is technically anything passed down from generations. I think of generational wealth as more than just inheritance. It’s things like paying for college, house down payments, giving a car, paying for daycare/grandchildren’s tuition/activities/tutors - things that allow the next generations to not go into debt and be better off than the generation before them.

[Anonymous]

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

OP's question was about what you want to leave to your kids, not what your parents should have left you. You're answering a different question because you don't have the goal to leave generational wealth to anyone, you just wish you'd been born into it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

Oof. You act like you are too good for a Prius.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

Oof. You act like you are too good for a Prius.

At some point money has to be used for something

[Anonymous]

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

It’s only gone if you blow it on dumb stuff. If you use it to may for things now and have more money later, then it’s not gone. If you live within your means and don’t retire early, you can use money now to set up opportunities that create even more money later. Money spent on kids going to college debt free sets them up to build wealth.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

Oof. You act like you are too good for a Prius.

That's nothing after acting like her parents somehow screwed her over by only leaving her $2M.

[Anonymous]

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

Wow, you're spendy! No wonder you're not wealthy despite all your advantages.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

If you paid for your own house and kids' college and invested the $2M your parents are leaving you, then it wouldn't be gone in an instant. It would double every 10 years or so and then be an amount that your kids or grandkids could use the 5% return to supplement their incomes in perpetuity.

Well yes but then you're asking me to sacrifice my own lifestyle which I'm not willing to do. That defeats the entire purpose of "generational wealth" if we're living in a cardboard box and driving a Prius

Oof. You act like you are too good for a Prius.

At some point money has to be used for something

Reminder, in case anyone has forgotten: You can give it to people who need it more than you, even if they are not related to you. On average, it costs $4,500 to save a life: https://www.givewell.org/cost-to-save-a-life . That is, if you give $45,000, there will be on average 10 people alive who would otherwise die. (Yes, this is uncertain; it might be only 8 or might be 12 on average, and there's no guarantee that your specific money will save those specific number of lives, but on average, it's true.)

[Anonymous]

Anonymous wrote:

Anonymous wrote:In my opinion, if it can easily be spent on basic necessities within a generation, then it's not generational wealth. My parents are leaving ~1 million for grandkids college and another million to my brother and I. Welp that will be more than gone as soon as they hit college and will just help me pay off my house a little faster. Even with 10 million, that would be gone by the next generation considering all the grandkids and great grandkids. Not even enough to accumulate interest. 100 million yes you are getting to a point where it works because assume a ~5% return just living off that, you're drawing $5 million a year and then you can start supporting a good lifestyle for multiple families

Wow, you're spendy! No wonder you're not wealthy despite all your advantages.

So if you ever spend wealth, you're spendy? lol