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Generational wealth sounds like something reserved for the 1% of America’s elite, out of reach for the average person. However, it is not. The term “generational wealth” simply refers to any assets passed from one family member to another. This could include anything from a family business to stocks, savings or real estate.
By building intergenerational wealth, you can rest easy knowing that your family will be financially secure even when you’re not there. Your family can also enjoy the comfort that this brings, especially if they currently rely on you as their primary source of income. But how do you create generational wealth? This personal finance article can help.
What is Generational Wealth?
Intergenerational wealth refers to assets that are passed from one generation to the next. This could include investment accounts such as stocks and bonds, savings accounts, life insurance policies, and even cash. It may also include cars, real estate, jewelry, businesses, heirlooms or collectibles, and more. Anything with monetary value qualifies – it doesn’t have to be cash.
How to Create Generational Wealth
Intergenerational wealth can help families maintain long-term financial stability and save individual members from undue hardship.It provides a financial buffer to fall back on, but also options – for example, it can help future generations avoid student loan debt. However, the challenge in building this buffer is building wealth to sustain multi-generational survival. This requires more than simple assets like savings.
why? Savings accounts can get cut and drained over time. Also, the money inside is likely to depreciate due to inflation. The key to building generational wealth is investing in assets with growth potential. Here’s how you can get started.
Know your 401(k)
One 401(k) plan It’s a retirement account…
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