15 Moves People Make That Hold Them Back From Creating Generational Wealth

Generational wealth is the legacy that keeps on giving. But, let’s face it, creating it is like playing a strategic board game where the rules aren’t always clear. Here are moves people often make that unwittingly set them up for a checkmate against their financial future.

1. Waiting to Invest Until They Have “Enough” Money

Investing is about something other than waiting until your bank account looks like a phone number. It’s about starting small and early. Think of it as planting a money tree that grows over time.

2. Taking on Risky Investments

While it’s tempting to jump on the latest investment fad, like crypto, it’s essential to understand that a high-reward game often comes with high risks. Instead, focus on proven long-term strategies like index funds.

3. Spending Too Much on Investments

High fees can eat into your returns like a sneaky tax. Opt for low-cost alternatives like passive index funds or ETFs.

4. Never Buying Property

Real estate can be a cornerstone of generational wealth. Owning a property is like having a golden goose that lays eggs through rental income or appreciation.

5. Ignoring Education

Investing in education can unlock doors to higher earning potential. Consider setting up a 529 plan for your kids‘ college fund.

6. The “Retail Therapy” Trap

Feeling stressed? Down in the dumps? Don’t reach for the credit card like it’s your emotional support animal. Retail therapy might give you a temporary high, but that new pair of shoes won’t pay your rent or fund your kid’s college tuition. 

Learn healthier coping mechanisms, like meditation, journaling, or a good old-fashioned scream into a pillow (just make sure no one’s watching).

7. Consulting the Magic 8-Ball Instead of an Expert

Financial planning isn’t a DIY project. Consulting experts like CPAs or financial advisors can help you navigate the complex waters of wealth building.

8. Not Investing in Appreciating Assets

Assets like stocks, real estate, and even fine wine appreciate over time. It’s like a financial symphony where each instrument plays a crucial role.

9. Holding onto Bad Debt:

High-interest debt is like carrying a backpack full of rocks uphill. Pay it off and feel the weight lift off your financial shoulders.

10. Failing to Plan for Estate and Taxes:

Estate planning isn’t just for the rich and famous. It’s about steering your wealth ship so it doesn’t hit an iceberg called taxes.

11. Overlooking Passive Income Streams:

Passive income streams, like rental properties or royalties, are the financial equivalent of having a team of robots working for you 24/7.

12. The “Get Rich Quick” Scheme Siren Song:

There’s no magic formula for overnight wealth, folks. Those “guaranteed” investment schemes are as real as a unicorn riding a rainbow. Avoid anything that promises quick and easy money, and remember: slow and steady wins the financial race.

13. The “Keeping Up with the Joneses” Marathon:

You know the Joneses? Those mythical neighbors with the McMansion, the luxury cars, and the kids who wear designer backpacks filled with gold bullion (probably). 

A 2019 study in PNAS: Revealed that social comparison on social media negatively impacts both financial decisions and self-esteem.

Stop trying to keep pace in this never-ending race. Your financial goals should be based on your values and needs, not the highlight reel of someone else’s life.

14. The “Retirement is for Old People” Procrastination:

Let’s face it, retirement planning isn’t exactly the most thrilling topic. But trust me, 60-year-old you will be thanking your 20-year-old self for starting that retirement fund early. 

Time is your greatest asset when it comes to investing. The sooner you start, the more that magic little compound interest can work wonders.

15. Financial Illiteracy in the Family:

Teach your kids about money management early. It’s like giving them a treasure map to navigate the world of finance.

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