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March 16 - March 17, 2021
42 percent of the millionaires we interviewed for our latest survey had made no trades whatsoever in their stock portfolios in the year prior to the interview.
Dr. North is a focused investor. He has two favorite investment categories, agricultural land and stocks from the medical industry:
Choose a financial advisor who is endorsed by an enlightened accountant and/or his clients with investment portfolios that in the long run outpace the market. If you don’t have an accountant, hire one.
If your goal is to become financially secure, you’ll likely attain it…. But if your motive is to make money to spend money on the good life,… you’re never gonna make it.
PAWs love working, while a large proportion of UAWs work because they need to support their conspicuous consumption habit.
Money should never change one’s values…. Making money is only a report card. It’s a way to tell how you’re doing.
Mr. Allan is extremely perceptive in his understanding of under accumulators of wealth. In essence, he feels that products change people. If you acquire one status product, you will likely have to purchase others to fill up the socially conspicuous puzzle.
Some wealthy parents buy their adult children homes in affluent neighborhoods. Great idea? Perhaps they should realize that “affluent neighborhoods” are high-consumption neighborhoods. From property taxes to the pressure to decorate, from the perceived need to send their children to expensive private schools to the $40,000 four-wheel-drive luxury Suburban, the children are now on the earn-to-spend treadmill. Thanks, Mom and Dad! As Mr. Allan, the super-PAW, told us:
About 45.7 percent of the affluent are dealer loyalists
“If I don’t sell it in thirty days, I will consider lowering the price.”
EOC: It is much easier to spend other people’s money than dollars that are self-generated.
32 percent of America’s millionaires pay for their adult children’s graduate school education.
Gift receivers… the adult children of the affluent feel that their parents’ wealth/capital is their income… income to be spent.
as a group, teachers are frugal.
we remind them that teaching their children to be frugal is critical. Often those who are trained to be otherwise as children become adult hyperspenders, needing cash subsidies during their young and middle adult years.
What was the most frequently mentioned gift that millionaires received from their parents? Tuition!
Typically, the most economically productive one receives the smaller share of his or her parent’s wealth, while the least productive receives the lion’s share of both economic outpatient care and inheritance.
Parents often ask us how to instill courage in their children. We suggest that children be exposed to the sales profession. Encourage your children to run for class office in their elementary or high school. They will have to sell themselves to the student body. Even selling Girl Scout cookies can have a positive impact. Retail sales jobs provide another way for children to be evaluated by very objective third parties.
Beth lives less than two miles from her parents. (One of the proven ways that domineering parents control their adult children is by living close to them.)
Ann will never allow her parents to control any portion of her life or the lives of her husband and children.
My daughters are the beneficiaries of all my life insurance policies, more than enough to take care of all my estate’s taxes and expenses. The girls are left with the balance.
You can never fully trust your sons-in-law…. Divorce is always a possibility.
I have two children. They are close to each other. They can settle my estate between them…. But they will do it along with my attorney…. The children and my attorney are executors of my estate. I put the attorney in just to keep the balance…. You know when money’s involved what can happen. I want to keep good relations,… but good relationships may deteriorate at the last moment without an experienced professional.
In response, seven of the nine participants stated that, in addition to a family member, at least one outsider would be co-executor of their estates.
over the years, he had developed close relationships with a highly skilled estate attorney and an outstanding tax accountant. Mr. Ring sought their advice before he retired, realizing that someday these professionals would likely act on his behalf to prevent, or at least reduce, the probability that his grandchildren would battle over his estate. Through the years he had also sought their counsel on how to “give without spoiling.” Mr. Ring now gives gifts to his grandchildren, but not in the form of products or social privileges. And he never gives without first gaining the approval and
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The trusts for the grandchildren are controlled…. Money is distributed only when each grandchild reaches certain maturity…. I was a little against it. But I listened to my lawyer and tax man…. I don’t want to reach out from the grave to control them,… but the way the trusts are set up, my grandchildren will have to work.
most PAWs have long-term close relationships with several key professionals, such as top attorneys and accountants.
Never tell children that their parents are wealthy.
No matter how wealthy you are, teach your children discipline and frugality.
Assure that your children won’t realize you’re affluent until after they have established a mature, disciplined, and adult lifestyle and profession.
Minimize discussions of the items that each child and grandchild will inherit or receive as gifts.
Never give cash or other significant gifts to your adult children as part of a negotiation strategy.
Stay out of your adult children’s family matters.
Don’t try to compete with your children.
Always remember that your children are individuals.
Emphasize your children’s achievements, no matter how small, not their or your symbols of success.
Tell your children that there are a lot of things more valuable than money. Good health, longevity, happiness, a loving family, self-reliance, fine friends… if you [have] five, you’re a rich man…. Reputation, respect, integrity, honesty, and a history of achievements!
