The Power of Influence: How Parents and Grandparents Shape Financial Legacies
I received an email from my Aunt Lisa the other day that reminded me of how fortunate I am. It linked to a news story about my late grandfather – who was known as “Chief” to his family and Horace “Huffy” Huffman to the rest of the world – and how his contributions to his beloved Northern Michigan community continue to be felt more than 20 years after his death.
The article highlighted a bike ride for all area fourth graders, which was sponsored by the Northern Michigan Trails Council, an organization my grandfather founded to develop and maintain bike paths throughout the region. Bikes and helmets were provided for all riders and the event appeared to be a huge success.
The story reinforced my belief that parents and grandparents are the greatest influence on the financial lives of their children and grandchildren – including their feelings about money and their habits in spending, saving and investing. That influence can last a lifetime – and even beyond. That is why both articulating and modeling family and financial values are so important.
To illustrate my point, let me tell you more about Chief. My thoughts of him always involve bicycles. He devoted his career to building bicycles for American families and promoting cycling for all. Over the years, he grew a modestly successful family-owned business into a Fortune 500 company and well-known brand.
The commitment was also personal: Chief loved to ride through the woods and along the water in Northern Michigan and did so every day in his summers there. His was driven to make sure others could enjoy the same experience. In this way, he lived his values. Biking was a huge part of his life – not just how he made his living.
Chief’s influence over the lives of his children and grandchildren remains strong. My father taught me, just as Chief taught him, that our family’s good fortune came with responsibilities to our community. Financial support, regular engagement and even organizational leadership were among the ways that Huffmans were expected to give back. Our family – which reaches from New York and New England through the Midwest to the Pacific coast – is involved with a very wide range of cultural, non-profit and charitable causes. It’s just what we do.
In Chief’s view, our responsibility also extended to our work lives and careers, and he believed everyone must do substantive and productive work, whether in business or other fields. It was good for the soul – and a sense of accomplishment – to earn one’s own living and build one’s own wealth. Our family wealth was measured in human and social terms as much as by financial metrics. Therefore, it was meant to be shared and reinvested in the communities where we live and work.
There is a paradox with inherited family wealth – it can be both a privilege and a burden. To some, unearned wealth may feel undeserved, and thus lead to guilt or other complex feelings. The same abundant resources that provide inheritors with unlimited financial security and personal freedom may rob them of initiative, confidence and self-worth. In terms of leaving inheritances, Chief would’ve certainly agreed with Warren Buffett’s idea that the ideal amount is enough so that younger generations can do anything, but not so much that they do nothing.
Chief was engaged professionally and active in the community until the day he died, serving on various boards of directors and acting as a mentor to many. My father has followed a similar path, starting another family business in retirement, which has thrived and is being transitioned to the next generation. My career is critical to my own well being and sense of security and wealth. I expect my children to embrace that attitude as they grow older.
Today, I feel the lasting influence of my grandparents and parents through the values they taught me, which are an essential part of who I am. Through my own experience and those of clients, I strongly believe that parents and grandparents should acknowledge openly the impact wealth has on their lives and those of family members. This is why articulating values and modeling behavior are so important. To promote and facilitate valuable conversations, we recently completed an eBook that includes useful tips for talking about family wealth to kids of any age.
In the near term, it will help your children develop good financial habits and a healthier attitude toward money. In the long term, it can help preserve your family’s wealth and community legacy for many years or even decades to come, as my Aunt Lisa so happily reminded me.