In the last few years, we have seen a rise in money. Technology and its advancements have brought about many more high net worth and ultra-high net worth individuals. Data researched by Trading Platforms UK indicates that 70% of the top ten wealthiest people amassed their wealth from the technology industry as of March 1, 2021. The top ten wealthy individuals control a fortune of $1.14 trillion in total, with tech players accounting for $855.9 billion.
In the world of wealth planning and future-proofing wealth, the current cohort of wealthiest is most likely in the first generation of wealth. However, we all have seen and heard the statistic and old age cliche’s “shirtsleeves to shirtsleeves in three generations”. This adage, which describes the inability of grandchildren to manage the wealth passed down to them from their grandparents and parents, has hung over the world’s highest net-worth families for decades, threatening the continuation of family legacies. According to the Family Business Institute, only about 30% of family businesses survive into the second generation, 12% are viable into the third generation, and only about 3% of all family businesses operate into the fourth generation or beyond. Many may think they are immune to this because the companies become so big that it feels impossible to fail. However, we all know that nothing is impossible. The Titanic was touted as a ship that could never sink, yet unfortunately, its fate proved otherwise. When speaking to family offices and family wealth, it’s crucial to start future-proofing the business and to create multi-generational wealth that goes past just three generations.