This is a question that concerns many people who have built up savings over their lifetimes (or intend to do so.) They understand the hard work and sacrifice that goes into building wealth, where apparently the younger generations just don’t get this. (How many times do we say to our young people “money doesn’t grow on trees” or “when I was your age, I used to work 7 days a week….?)
But it is not just young people. Over the next 30 years, it is estimated that around £5.5 trillion will pass between the generations in the UK, representing the greatest transfer of wealth in history.
But given the very poor state of financial education in the UK and the fact that as we have written previously, talking about money is still uncomfortable for most people, we are concerned that those likely to inherit all these trillions will be decidedly ill-equipped to deal with them.
We know from experience that people who inherit a lot of money unexpectedly, or get a lot more than they were expecting, find it difficult to come to terms with how it might affect their lives. Owning a lot of money and/or property comes with a great deal of responsibility, particularly when it has been inherited from a loved one who they wouldn’t want to disappoint.
At Magenta we have seen whole families torn apart arguing about money and family assets; we have clients who have been terrified to make any decisions in case they were wrong (like a rabbit in the headlights) and we have seen the terrible effects of stress and mental illness on people who are just not capable of dealing with decisions about money.
Money can indeed be the root of all evil in the wrong hands or used in the wrong way. At Magenta we know that money in itself is not important – it is what it can do to enrich our lives and enable us to achieve our heart’s desires that is its great value. It is just a commodity and when it is used in a positive way to pursue passions, to enhance relationships, to deliver security and happiness, peoples’ lives can be changed for the better.
We are here to help. We can help to initiate and mediate conversations about money in families. We can facilitate coaching and education sessions for people who want to know what to do next and we can also ensure that when all this money does start to move between the generations, that the tax man doesn’t get too big a slice of it.
If you would like to know more, do call us for a friendly chat.