By Kathy J. Marshack, Ph.D., P.S.
It was starting to dawn on Dyan that a divorce from Cooper was not enough to protect her children and to teach them the important values of life. Six months earlier she had come into therapy to help her make a decision about her marriage. Her feelings for Cooper had died a long time ago, but she felt guilty breaking up her family, especially because she worried about the grief it would cause her two children, Mara, age thirteen, and Philip, age five. Cooper was not a bad person really, but he and Dyan did not share the same values about life, parenting and money.
Cooper’s entire focus was the thrill of making money, something that he had a knack for. Before age thirty, Cooper had amassed several million. When he and Dyan married, he was already wealthy enough to ask her for a prenuptial agreement. Both had come from humble beginnings, growing up together in a small town. While Dyan focused on getting an education and developing a professional career, Cooper dropped out of college and sought his fortune in the high tech industry. When Cooper asked for the prenuptial agreement, Dyan didn’t mind. She was in love and believed that money would not make or break the relationship. Later her naiveté came back to haunt her, not because she stood to lose a lot of money with a divorce, but because she underestimated the power of money to affect the well being of herself and her children. Though the couple was wise about investments, as their wealth grew, their relationship deteriorated and family life suffered.
There are dozens of resources for wealthy people to guide them in managing their investments. There are conferences and seminars offered by banks and investment firms. There are books and journals full of advice on how best to preserve your wealth. There are lobbyists for interest groups working to change tax laws and create tax shelters. But very little attention is paid to educating the wealthy on how to integrate health and wealth. Ignored are those soft issues, such as keeping an open heart, connecting with a higher spiritual purpose, maintaining loving friendships, and guiding impressionable children in the development of strong self esteem. It’s not that people think these things are unimportant. In fact, most of us believe that God, loving relationships and healthy children are our primary work. However, because these are soft issues, hard to pin down and work on, they are often set aside for later . . . after the phone calls, after the business meeting, after an Internet search, after we pick up the dry-cleaning. However, the meaning of life needs to be attended to first, not later. Money cannot replace the success of having lived a meaningful life.
The challenges that face wealthy families are many. Planning for succession of the business is one. There is much being discussed these days on how to prepare a junior member of the family for succession to leadership. However, it seems to me that this is putting the cart before the horse. To prepare children for leadership in the family business or in the community requires quality parenting from the start. Your child is not a miniature adult. He or she does not have the cognitive development, or the life experiences yet to handle the complexities that comprise the world of most wealthy adults. If you want your child to grow up to be successful in life, whether it be as your successor in the business or in his or her own venture, then your focus from day one should be on building his or her self-esteem.
In order to build self esteem in your children, you must consider parenting a full time job for both parents. This is true with all children, not just the wealthy, but wealthy children require even more attention. Wealth makes your children different and more vulnerable than the average child. You have all of the normal responsibilities of parenthood; that is to instill your most cherished beliefs and values in your children. You must teach them the skills of independence, right from wrong, how to be a good person, how to choose friends wisely, how to dream, develop their talents and work to accomplish those dreams. But in addition to all of this, wealthy children must be taught how to handle the considerable responsibilities that wealth brings into their lives. These children will have fewer peers than the average child. They have more resources and more opportunities than the average child. They are expected by others to know more and accomplish more, however unfair this may seem. These differences are not only statistical; they make the child feel different. And feeling different is a hardship for most children. If a child is unprepared for these differences or responsibilities their self-esteem can be severely shaken and they can sink into depression or at the very least be an underachiever. Many children of wealthy parents fail to graduate from college. There is an alarming rate of teenage suicide among this population. As incredible as it may seem this is a seriously at-risk population.
I believe preparing your children for handling the responsibilities of wealth in a healthy manner is one of your primary tasks in your wealth preservation plan. Carrying out this responsibility is really quite simple. Your children should be part of the wealth management plan from the start. Too many wealthy parents don’t consider the need to introduce young children to this process. But think about it this way. It is important for your child to learn to brush his teeth and make his bed, because it teaches responsibility and important life skills. He must do his own schoolwork too. Even if you have a nanny, housekeeper and gardener, your child probably likes to help around the house and this teaches him or her more useful adult life skills. But even more importantly than skill building, helping the adults makes the child feel as if he is an important contributor to the family. Many wealthy children do not feel important because everything is provided to them without their input or effort. So, give your child a chance to participate in the wealth management of your family estate. Perhaps they can contribute their own earnings to buying their own clothes or they can set up a savings account for college. If they are older they can use their savings to invest in stock or mutual funds. I know of one young man who paid his college tuition from earnings on his stamp and coin business. There is nothing so satisfying as creating your own way in the world.
There certainly are many other psychological challenges facing families in business, but parenting is probably the toughest. Keeping marital intimacy and communication alive and healthy is another. Attending to one’s physical health is still another challenge that I find many wealthy families are poor at. And as I said earlier, one’s spiritual commitment is sorely compromised by the many demands of a family enterprise and the expectations of one’s community. But is it really so hard to keep these priorities in focus? All you have to do is remind yourself each day what you want to be remembered for when you die. If you are willing to take 10-20 minutes each day for a meditation or prayer to center and focus yourself on your most dearly held values and priorities, you will be guided by your open heart and higher spiritual purpose throughout the day.