This is an article every parent must read till the end. It will work as an eye opener for many of us.
We live in a society where majority of us inherit house and wealth from our parents who have inherited it from their parents. The longevity of lives due to better medication and health facilities have brought us to a stage where joint families have senior citizens living with their children who are in their mid-fifties who in turn are living with their children in their teens.
Wealth creation is a long term process where one invests and creates long-term wealth, uses it and passes the rest to the next generation.
Now to start with the main text of article, today’s youth is finding difficult to get a decent job. If they get a good job they do not get a desired pay, if they get desired pay, they do not get the time to spend on desired activities. So the problem is, majority of youngsters live a life with discontent. Many of my clients are senior citizens who have lakhs of rupees in real estate, FDs, Mutual Funds and Stocks. The combined net worth is in crores. But, when I approach younger family members for SIP, they find it difficult to shell out even Rs. 5000 a month. On inquiring to the senior citizens about their intentions for distribution of wealth, I have a few common answers…..
- The male super or senior citizen says I will give my wealth to my wife if I die first and let her decide what she does later on
- The female super or senior citizen says I haven’t thought of what to do but ultimately my children will inherit it from me
- Another excuse they have is, if we distribute wealth, our children may not take care of us or may not live with us. Ultimately they will inherit when we die, so why to take the risk?
- Still we have few years to live; we may have sudden medical expense which we want to pay from our wealth
- We will gift it to our grandchildren. And many more reasons which have no logic.
The mid generation is working hard to up bring their children due to rising cost of education, increasing demands and inflation. The teenagers find it difficult to earn due to which they have expectations from their parents. Two lower generations are struggling while the top generation is wealthy but afraid to distribute wealth. The middle generation inherit wealth when they would have lost their interest in life. Their Hair turning white and teeth turning black. Wealth inherited after fifties is useless for having fun in life. The mid generation having experienced this will repeat the same. This becomes a vicious cycle.
The big question here is why do parents find such excuses for not distributing wealth?
I would like to present some of my observations for such behavior,
- Having no medical insurance keeps them afraid due to rising medical costs
- Not having life insurance make the couples feel insecure
- Not having a proper financial plan due to which there is a constant fear of dying poor
- Having a mentality of “we have lived like this, why can’t other generations live the same?”
Look at the plight of entire family, the one who has money cannot and doesn’t spend; the others who want to spend do not have money. The money with the topmost generation is sufficient for all generations to live a happy life but there is fear. The fear is due to lack of financial planning.
This is my sincere request to all those reading this article, have a financial plan. It includes investment, insurance, wealth creation and distribution. Don’t repeat the same mistakes that the current elder generations have made. Let the young generation live a happy life if their parents or grandparents can afford it for them. Buy them a ticket for travelling with their family, take them out for dinner, gift them and their children with useful gifts, buy them a vehicle for which they have spent years dreaming of, gift them something precious on Diwali and new year, if you see them planning for something than give them a financial push and support, buy a financial plan for your grandchild which will relieve their parents of financial burden (I have 48 clients above 60 years of age, of them about 39 have grandchildren. Only 2 clients have done this for their grandchild). Spread happiness. All this comes with just Financial Planning. Let's distribute happiness