Stories abound of family business empires that lost everything over a few generations. The saying "Rich father, noble son, poor grandson" has adapted translations in several languages all around the world, reflecting that the trend is regrettably, a global one.
Why does this happen? One of the reasons is that, more often than not, the next generation feels entitled to wealth and assets that they did little to create or grow. And it's only through generating value that a new generation begins to understand how to manage and maintain it for the next.
Families that have been successful in maintaining their wealth over time, have done so because they instilled in their children a sense of stewardship rather than one of individual ownership: the wealth belongs to the family as a whole and is something to take good care of and to nurture for succeeding generations.
A tip: dividends from the family business should not be counted on as a living.
All through the company’s boom and bust, the number of heirs grew, many relying on annual dividends of up to hundreds of thousands of dollars to fund sometimes lavish lifestyles.