I have always thought that the greatest legacy that one can leave their kids is riches. And that was before I had kids. Now that I have kids and a bit more mature, I am beginning to think that I might be wrong. Yes, like any other normal parent, I want my kids to be super comfortable, I want them to have what everybody else is having and a bit more. I want them to go to the South of France for holidays, to have breakfast in Cape Town and supper in Cairo, to own penthouse suites in Manhattan, to ride the gondolas of Venice. Ummm, it sounds like I want to live vicariously through my children. But isn’t that what parenting is all about, we want our children to have what we never had.
The bible says a wise man leaves an inheritance for his children and his children’s children. From as far back as I can remember, I have always thought of this verse as pure genius but now, with two kids, I am forced to think deeply about this verse. Leaving the children an inheritance is great because their holidays in the South of France get guaranteed, rides between Cape Town and Cairo gets assured and probability of getting that penthouse suite goes higher. All this, is on the expense side. This inheritance without any means of growing it, will surely diminish and will surely disappear before long. So isn’t there something missing to this verse?
On the other side of the coin, I have recently read articles where seriously wealthy people are not planning on leaving their kids anything eg Bill Gates, Simon Cowell, George Lucas to name a few. They all have one common reason for this decision, their kids will need to create value in themselves to earn a living, they believe that kids that are handed money will fail to launch and will ultimately not survive the jungle of life. Does this make sense? I believe it does. For example, have you ever noticed how November and December sales usually spike up in most industries. 1. Its the holiday season and 2. Bonuses will be in. We all have an innate sense of seeing bonus as free money and because its free money, it will be spent as reckless and thoughtlessly as possible. This is called Mental Accounting bias, we treat this money differently in our minds, the hard earned money deserves to be used constructively with the utmost care but the bonus we adopt an ‘ah, who cares’ attitude. Anytime, money is freely given, it is recklessly used, we generally don’t value things we don’t earn and this goes for everything in life. Now, ladies, do you understand why there is advise about playing hard to get, men need to feel they have earned the rights that they eventually get entitled to.
Now, here I am, two kids later. I am now in this quandary, whats the greatest legacy I can leave for my kids. Its actually a cliche but the greatest legacy one can leave their kids is the right education. Great amounts of money without the financial education about the laws of debit and credit will lead to ruin. Leaving kids with no money and no financial education is another terrible formula. A good education in whatever discipline where the child can earn money and a good grasp of financial education to multiply the earned money is a great formula for success.
I know you would rather take the money, but money without the education will kill you. Take the money and the education for true success.