Here’s a staggering fact: Families fail to keep their fortunes together for three or more generations 90% of the time. Want to beat the odds? The key is to focus on all four types of wealth and capital - human, intellectual, social and financial.
Human capital involves who we are, where we come from, and the talents of the family.
Intellectual capital includes work and life experiences, formal and informal education, spiritual beliefs and practices, and work ethic.
Social capital consists of a person’s contribution back to the community.
Finally, financial capital is comprised of assets, such as real estate, machinery, livestock and buildings.
These components make up a holistic view of wealth and it is important to transfer all components of wealth to the next generation. Without which, the financial wealth will eventually disappear.