A crash course on generational wealth—how to build and protect it for yourself and your loved ones

Generational wealth is not only for the ultra rich. You can also start building your own and pass it on to your children and theirs. 

Over the weekend, Rihanna performing at a pre-wedding party achieved online virality.

It prompted the question: Who is crazy rich enough to bring one of the world’s biggest pop superstars from halfway around the world to a small town for a pre-wedding performance?


Rihanna in india for the ambani pre-wedding party #ambaniwedding #india #rihanna

♬ original sound – Diet Paratha

The answer is Mukesh Ambani. India’s and Asia’s richest man, he is also currently the world’s 11th wealthiest man with a net worth of $117.2 billion, according to Forbes

The 66-year-old chairs Reliance Industries, a massive conglomerate founded by his father, Dhirubhai. After his father’s death in 2002, Ambani and his younger sibling Anil divided the family empire.

Mukesh Ambani is Asia’s richest man and the world’s 11th wealthiest. Photo from Forbes India

The conglomerate reports over $100 billion in annual revenue, with interests ranging from petrochemicals to telecoms and retail.

Generational wealth 101

Having inherited his immense wealth from his father, it’s safe to say that Mukesh has what is called “generational wealth.”

We’ve heard all about the term, read and even watched families squabbling over tracts of land or last wills and estates. 

But what is generational wealth?

According to Fortune, it “is essentially any kind of asset that is passed down from one generation to the next. This might include cash, investment funds, stocks and bonds, real estate properties, or even businesses.”

Whether in Asia or the west, however, one major challenge for business leaders is how to prepare for a smooth succession. It can sometimes be a tricky and messy affair, but the bulk of generational wealth is passed down at death in the form of an inheritance. 

The Sys, one of the Philippines’ and Asia’s richest clans, for example, inherited their vast fortune from their late father, Henry Sy Sr.

Reports said the succession was smooth with hardly a “ripple,” largely because Sy Sr. bequeathed his fortune equally among all his six children.

Ambani himself started to put into place a clear succession plan for Reliance Industries in early 2023, seen as an effort to avoid a dispute similar to what happened between him and his brother when their father passed away. 

He appointed his three children, Akash, Isha, and Anant, to the board of the company after approval from shareholders.

Building your own generational wealth

Generational wealth, however, is not only for the ultra rich. You can also start building your own and pass it on to your loved ones in the future. 

Ivana Pino, in an article on Fortune, suggests growing your generational wealth by investing. 

“Don’t wait to start investing. Investing can be key to making your money work for you and grow over time,” she writes.

Investing is one way to start growing your generational wealth. Photo from HDFC Sales

She adds that you don’t have to have tons of money to start investing. Just “a few dollars” can add up to a significant cushion over time—“one that you can pass down to your children or heirs.” 

Pino clarifies that investing isn’t only limited to stocks and bonds. Real estate investments can be another effective way to build and easily transfer wealth.

“Well-maintained properties in high-demand areas can increase in value over time and provide a great deal of equity for homeowners over time,” she notes.  

She also advises that one should have multiple streams of income. “Saving and investing for your future self and those that come after you means having enough funds to cover your expenses in the present,” she explains. 

Now, if you’re wondering if you can start building generational wealth even with limited financial resources, Dawn Papandrea of Investopedia says you can make it one small step at a time. 

Even with limited financial resources, you can start building your generational wealth. Photo by Marek Ślusarczyk for Wikimedia Commons

“Create a budget that allows you to allocate money toward savings each month. Make lifestyle choices that help fuel your financial goals. And invest in your retirement as early as possible to give it time to grow,” she advises.

Papandrea says that if you’re a first-generation wealth builder, committing to taking the first steps which involves saving money, building an emergency fund, and starting to invest for the long term and following through with consistency will pay off.

Easier said than done, for sure, but sacrificing and building generational wealth has both short- and long-term benefits that make it worthwhile. 

“In your lifetime, you’ll get to enjoy the peace of mind of knowing that your loved ones will be well taken care of financially. You can also share your knowledge and insights with your children and grandchildren to help instill strong financial habits that can help them keep the family legacy strong for the next generation,” she says.

Protecting your generational wealth

Let’s say you already have started building your generational wealth, the next question is, how do you protect it?

Papandrea advises making sure you’re properly insured—through home, auto, and life insurance. Working with an estate planner is also one of the best ways to protect your assets. 

She emphasizes: “Be sure you at least have a will, and consider establishing a trust.”

Making sure you’re insured and working with an estate planner are two of the best ways to protect your generational wealth. Photo by kschneider2991 for Wikimedia Commons

Pino echoes the same suggestions, saying that regardless of what you have now, having documents in place that ensure a smooth transfer of the assets you leave behind protects the wealth you’ve built. It also gives the next generation a secure foundation from which to start. 

In her article, she quotes Colleen Carcone, a certified financial planner, who says that, “The most important thing to do when you are building generational wealth is to surround yourself with a team that will help you accomplish your objectives. 

The team, she says, should include not only your estate planning attorney, but your tax adviser and your financial adviser.  

These experts, Carcone adds, can help you create a trust for your beneficiaries that outlines how your wealth should be distributed and invested, and who will be entrusted with your assets.

Associate Editor

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