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This as-told-to essay is based on a conversation with Barbara Goodstein, managing partner and New York City chapter chair at R360. It has been edited for length and clarity.
I became a millionaire in my 30s. Now that I'm old enough that my two kids are approaching 30, I'm a multimillionaire. I made my wealth by climbing the corporate ladder, and serving on the boards of public companies.
That's a very different situation from the ultra-high net-worth families I work with at R360, where I'm a managing partner. R360 is a peer-to-peer networking group for people who have a net-worth of at least $100 million. Most of our members founded and later sold a company.
The people who join R360 believe that wealth isn't just financial. They want their kids to understand that a rich life is one with self-worth, purpose, and fulfillment — not just money. How they teach that might surprise you.
Our members want to buck the tradition of not talking about money. There's a lot of concern about making sure children don't become spoiled or entitled.
We teach members to start talking to their kids in elementary school. Kids are going to notice, for example, that not everyone is traveling by private jet. These kids know they're different, so there's no point trying to hide it.
Instead, members try to create a sense of purpose. We recommend members talk with their kids around the child's birthday each year and ask, "What can you bring to the family in the next year? What responsibilities can you take on?"
I paid for all college expenses for my own two kids. Almost all our members do the same. There doesn't seem to be any debate around that.
There's much more discussion about when to stop financially supporting children. That's very personal to each family, but most centimillionaires are giving their children some financial support well into adulthood.
For some families, that continues throughout the lifetime. One member has a child who works in healthcare. That woman doesn't make much money, but she has a lot of fulfillment, so her parents are happy to keep supporting her financially. That member also plans to leave more to the daughter working in healthcare than they'll leave to their children with more lucrative careers.
Most of our members are philanthropists, and they need to talk openly with their kids about their values and the causes they support. They don't want to hand over their wealth to their kids and have money go toward causes they don't support. On the other hand, they don't want their kids to have to follow a wealth management plan that they ethically don't agree with.
This leads to lots of interesting conversations. Most often, it's around politics. Children want to be heard, and the parents need to hear them. Most families are able to negotiate a solution.
Recently, one of our older members was frustrated that his son didn't want to get a prenuptial agreement with his bride-to-be. He felt stuck, insisting on a prenup while his son pushed back on asking his fiancé to sign one (something that's expected in most centimillionaire families).
One of the younger members of our group stepped in. He came up with a way to present the prenup as protection for everyone. That let our older member have a more productive conversation with his son and soon-to-be daughter-in-law.
We host a group for the adult children of our members. A lot of these people, ages 18 to 34, are searching for their sense of purpose. They've had to live in the shadow of wildly successful parents. They worry about whether their friends expect them to pay for things, or only like them for their money. They're facing a big question: I've won the lottery in life, now what am I going to do with it?
Our members aren't afraid to leave their children money. But they're bucking the tradition of waiting until they're dead to transfer wealth. They want to give their children small opportunities throughout their lifetime to succeed or fail.
That practice, coupled with open, honest conversation, is a new approach to wealth. It focuses not just on money, but on a truly rich life, in every sense of the word. It's much healthier, and leaves the next generation more prepared to handle their wealth.
