A survey by PNC Wealth Management had some interesting results about how wealthy parents feel about the creation and maintenance of wealth when it comes to their own children, and those results may not be what you would expect.
Of the millionaires that were surveyed, 75-percent had grown up in a more middle-class, financially average family, whereas the percentage who grew up in a rich family or a poor family was 12-percent for each; in other words, 87-percent had to work their way to affluence.
When it comes to their own children, 82-percent of the survey participants believe their kids should be responsible for creating their own wealth, which is a rise of 17-percent from 2007. The most important goal for 80-percent of survey respondents was to raise their kids to be successful and hardworking.
The problem that wealthy parents are running into is that they are giving their kids a lifestyle that far surpasses what they grew up with. Be it cars, house payments, Ivy League tuitions, or travel, the children of these wealthy parents want for nothing. When it comes to estate plans, the pattern continues – albeit somewhat abated – with 61-percent planning to leave a substantial inheritance to their children.
The reason for this contradictory behavior is uncertain, but it may have to do with the fact that wealthy parents know that today’s economic market may not be as ripe with opportunity as it was yesterday, and, like all parents, they want to help their children have a good life.