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15 Ways to Create GENERATIONAL WEALTH


3m read
·Nov 4, 2024

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You know, by the time 65 rolls around, only one in 100 people will be well off financially. 70% of wealthy families lose their wealth by the second generation; more so, around 90% of families lose all wealth by the third generation. So, even if you do make a fortune in the most abundant time in history, statistically, you, your kids, or your grandkids will screw it all up.

By the end of this video, not only will you understand what it takes to build generational wealth, but you'll also have a game plan for your kids. Buckle up! Okay, you might want to take some notes here. Let's do this!

Welcome to alux.com, the place where future billionaires come to get inspired.

Number one: Buy land. In order for you to understand generational wealth, there's an important distinction we need to get right: personal wealth versus family wealth. For example, $100,000 sitting in your bank account—that's personal wealth! You can go to your nearest coffee shop and buy a coffee with money from that account. It's at your discretion, and it can be depleted.

Family wealth, on the other hand, is illiquid most of the time. That means it's hard to change it back into money or it requires extra steps. And because of this illiquid function, you're less likely to blow through it in case of petty spending. Land is the ultimate store of value. There's a fixed amount of land on planet Earth, and the fact that you can buy a piece of the earth is mind-blowing! Because the population is increasing and the demand for space is always shooting up, the demand for land will always increase too.

Buy land and have your children hold on to it; it'll only increase in value. And buy number five on this list will show you what you need to do with that land in case you need money so you don't have to sell it.

Number two: Buy cash flowing property. The golden gods of cash flowing property are apartment rentals, commercial property, or hotels. If you've played Monopoly before, you know how this goes: you buy, you hold, you wait, you cash in. As long as you don't sell the property and there's a demand for it, it'll forever put food on the table.

Here's the easiest recipe for generational wealth throughout your life: Buy at least two rental properties. Now, these won't give you the lifestyle of a king or anything, but you will never go hungry for as long as you live. When your kids become adults, teach them the golden rule as well, so they each buy two rental properties themselves. As long as you steer clear of any dramatic events, like an uninsured rare illness, in only two generations, the family will begin building a portfolio of passive income that will stick around for decades to come.

People will always need homes; businesses will always need shops to sell their goods; and people will always travel to nice hotels.

Number three: Build an evergreen business. There are some businesses out there that can survive through time. Most businesses can't. You might be killing it on TikTok right now, but your grandkids will definitely not be eating from your glow-up videos, so you need to expand. An evergreen business has made money in the past, makes money now, and will make money long after you're gone.

You want to have your mind blown? Boeing is a last name! The company was named by William Boeing after himself. Hilton is a last name; so is Ferrari, Lamborghini, Chevrolet, Porsche, Ford—all with the family’s last name. Mercedes-Benz was named after Carl Benz. Burberry, Gucci, Versace, Louis Vuitton, Balenciaga, Fendi, Chanel—all last names! Bosch, Dell, Disney, Dyson, Harley-Davidson, Hewlett Packard, Forbes, Guinness, Harrods, Hennessy, Jack Daniels, Kellogg, Lavat, Mattel, McDonald's, Ritz Carlton, Marriott, Rolls-Royce—Charles Rolls and Henry Royce. We could do this all day if we wanted to.

Almost every brand you touch in a store is someone's legacy, someone's brainchild that became a business structured in such a way that it survived until now. The family became the brand; the family became the business. The only requirement is to take it seriously and keep innovating and developing your space.

What would your last name sound like as a brand? What business can you start up that your children could...

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