I was motivated to write these articles on family money, because it is an area that I am very passionate about and I want to help as many families as possible create long term, intergenerational wealth.
When one reaches a certain level of financial might, various service providers emerge to assist in the managing of those resources and when done properly, these small streams of cashflow can be transformed into a mighty river over time and in future generations it will become a sea and then an ocean.
This is done through the application of key principles, and I always wondered why these principles are not widely disseminated, because it is knowledge of the truth that sets people free.
In my experience, regardless of where one is, they can become financially successful if they apply correct financial principles.
Making and growing wealth and money takes skill and the application of principles, (like anything in life) just like driving a car, planting crops; there are skills and principles related to driving and agriculture and if those are not followed then the results will be disastrous.
Another reason why skills and principles are important is one will see the progress of their hard work. There is a flawed notion that people struggle financially because they are lazy, this is not true. In some cases, the poorest work the hardest but they work hard at doing the wrong things, because hard work by itself does not build wealth.
There are laws, principles and skills that when they are applied with hard work, will bring great transformation even within a few years and we will discuss these as we go forward.
These principles do not work only for rich, middle class or poor families, they work for everyone. A family may be financially successful because they have built wealth from an enterprise they created or from a job, but for that money to be converted into long term wealth, they must begin to think much more holistically and learn to apply new principles and skills.
The first part of building a family’s financial legacy, is determining what is your family’s unfair advantage.
Each family is unique and has something original and authentic to offer the world, it is the packaging and distributing of this unique gift or talent that is the key to the family’s financial strength.
The first principle of wealth is to look inward and see that the solutions come from within, the self-discipline, creativity, passion, drive, internal dialogue, and ideas come from within, and these are the raw materials through which one builds generational wealth.
I will demonstrate this more clearly by telling a story from the Bible.
There was a widow whose husband had just died. To compound this tragedy, he died with debts and the creditors came to take whatever she had of value and in her case, it was her two sons.
They wanted to sell the boys as slaves to cover the debts. She went to the prophet to whom she told her story and the first question he asked her was ‘’what do you have in your house’’ to which she replied that she has nothing except a small pot of oil.
To which the prophet gave her a strategy, she is to go out to all her neighbours and borrow as many empty pots as possible and then come into her house and pour the oil into the pots.
She obeyed and took the oil and began to pour and as she did, something happened, the first pot filled up then the next and the next and eventually she realized that all the pots were filled.
She went back to the prophet to tell him the outcome of the story and he told her to sell the oil, pay her debt and live on the rest.
This story has a lot of applicable lessons for building wealth and the first – is recognizing what you have, when she was asked what she had, she said only a small pot of oil.
The world’s poor are extremely wealthy, a recent study showed that the assets of the poor in Egypt was more than all the foreign direct investment the nation has ever received including the Suez Canal.
Most of the assets is held in inactive form in that it cannot be used to create value and if they are asked, they will say they are poor and have nothing just like the widow in the story and they undervalue their assets and sell them to someone else who takes those assets, create value through products and services then sell it to them and then employ the sons and daughters of the original owners of the asset.
The oil in this case represents that unique gift your family has been given to serve the world, the pots represents specific problems, challenges that are in the lives of those around us and as we solve these problems from our inexhaustible supply of gifts and talents, then through this, we can begin to add value to the lives of people and people will give money in exchange for the value that has been created.
In further articles, we will discuss these ideas in more detail and eventually start speaking about specific strategies and steps one takes on the road to building generational wealth.