Saturday, 26 July 2014

Parenting 101 for the Rich and Affluent

     1.     Never let on that you are wealthy
Children imitate the high-consumption lifestyle of their parents, living in a way they believe appropriate for the wealthy to act. This will limit their ability to accumulate wealth on their own later on in life. 

     2.     Teach discipline and frugality anyway
Children develop habits from young, emulating the behaviour of their parents. Hence, it is not sufficient to tell children to be frugal but inculcate such discipline through being credible role models.

     3.     Save it till they're grown

     4.     Minimize specific discussions on inheritance or gifts
Never make verbal promises on specifics you are likely to forget. Your children are not likely to forget and these promises may lead to conflicts between your children.

     5.     Never give significant gifts as part of a negotiation 
Give because of love and kindness. Adult children lose respect for parents who give in to negotiating tactics. Instead of feeling love from the gifts, children learn that parents must be coerced and siblings become adversaries.
Matching these gifts to one child with equivalent gifts to another are often viewed as signs of guilt or appeasement instead of love.
Does the below sound familiar to you? 

     6.     Stay out of your adult children's family matters
Parent and child may have vastly different lifestyle ideals and resent interference from their parents.
Let them run their own lives - while you may view gifts and advice as signs of love, children view it as respect when you ask permission when contemplating gifts and ask permission to give advice.

     7.     Don't compete with them
Never boast of your wealth and accomplishments. Your children will know to appreciate your accomplishments.

     8.     Your children are individuals
Children differ in motivation and achievement and financial help is unlikely to reduce the differences. Instead, financial help to the underachiever emphasizes the difference and sows discord.

  The above parenting tips have been adapted from The Millionaire Next Door. Within the book is a whole chapter on affirmative action that can be taken by parents in ensuring their adult children are economically self-sufficient.

  Read my post on The Millionaire Next Door here.

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