“I like to remind people: Businesses come and go. But the families behind those businesses can endure for generations.” – Dr. John A. Davis 

The best gift you can ever give your future generation is financial independence and the wealth built by you and your ancestors over the decades.

If you are rich and are interested in knowing how to stay rich for generations or on the other hand if you are not rich enough but want to flip the destiny for your future generations then this Blog is a must-read for you.

 3 Generation Theory

1st Generation– Generally the first generation starts poor, but being hard-working and diligent they have the zeal and hunger to succeed. With sheer labor of decades, right strategies, and intelligence they become wealthy.


2nd Generation– This generation sees the real struggles faced by their parents and grandparents while growing up. However, they get access to better education and lifestyle facilities and they try to maximize the return out of it becoming even more successful.


3rd Generation– They are born with the silver spoon, thanks to the hard work their ancestors had put in. But, being unaware of the real struggles and challenges, they hardly value their money and splurge like anything.


This is when the growth stops and the wealth begins to decline and even the richest of families experience this.

It is a fact that globally 70 percent of wealthy families lose their fortunes by the second generation, and an astounding 90 percent by the third.


Let us understand better with the `“Family Wealth Paths” to explain how family wealth travels over time.           

1st Path – Path 1 increases and gradually starts to decline due to family consumption and not upgrading with technological advancements.


2nd Path- Path 2 declines faster due to poor investment strategies and family conflicts and division of wealth.


3rd Path- Path 3 grows and regenerates due to wise financial planning, correct investment strategies, and family unity.

Strategies to Stay Rich Forever

1. Accumulate Wealth and Pay off Your Debts.

First thing first- Earn more and spend less, to accumulate wealth over the years.

Also, a fortune is no fortune if it’s burdened with debts.

But, How to do this?

  • Use your passive income to spend, like income from rentals, dividends or interest income.
  • Make sure to not exceed your debts more than 20% of your total wealth.
  • Hire professionals and know how to pay debts as early as possible.
  • Spend only 5% of your Total Net Worth.
  • Build your assets.

2. Segregate Company and Personal Wealth


It is an essential and lawful best practice to not to combine your company and personal wealth.

Commingling funds is never advised, as it makes accounting and taxes difficult.

  • The Company is a separate legal entity and it has its assets and liabilities.
  • Keep your savings for your family, so try to make them a last resort for your business.
  • Hire professionals to set up and manage the business wealth and investments.
  • Separating company and personal finances also limit conflicts and succession battles that can rip so many families and empires apart.
3. Have a Divercified Portfolio

Aim to have a diversified portfolio to safeguard yourself from:

1.Market Crashes &

2.Financial Disruptions.

  • Invest your wealth across various sectors and classes.
  • Consider adding index funds or fixed-income funds to the mix.
  • Keep adding to your investments on a regular basis
  • Consider investments with varying risk
  • Keep an eye on your portfolio’s growth and take quick actions accordingly.
4. Invest in Life-Changing Companies

Research well before investing and look for the companies which can make a real impact and have the ability to change the future.

Invest in

  • Unique Products and Services.
  • With Life-Changing Returns
  • Invest in those companies which have the power to change people’s lives substantially.
  • Find those companies which can solve the problems and in a new way and have the potential to grow your investment.
  • Companies which can change the future via their goods and services are surely going to do well.
  • Try to explore the territories which others haven’t like investing in international markets or artificial innovation based companies etc.
5. Build Up Your Credit Score

You are better prepared for your future when you have a great credit score, i.e. you will not face money limitations as you can borrow money when you need it most.

To build a good credit score you can do the following things:

  • Pay your EMIs on time.
  • Improve credit score with a low utilization ratio.
  • Take loans for a longer tenure.
  • Maintain your old cards to strengthen your credit history.
6. Prioritize Financial Literacy For Your Family

Poor investing decisions can lead to the loss of wealth earned.

Hence, teach your children about financial planning and investing decisions.

  • Focus on budgeting, spending, and the responsibilities that come with holding multigenerational wealth.
  • Teach them what financial mistakes not to make.
  • Hire financial advisors who can help them take well informed decisions and help them their wealth.

7. How to Pass Down Generational Wealth


Do not wait for your retirement or any medical issues to crop up before you decide to pass down your wealth.

Life is uncertain, hence it becomes imperative to be ready with the following.

  • Have a well-drafted up-to-date will, it allows room for plenty of detail, down to the smallest asset.
  • Have a Life Insurance Policy to protect your beneficiaries.
  • Have an estate plan to avoid future confusion.
  • Setting up custodial accounts.
  • Naming beneficiaries for your financial accounts.

8. Surround Yourself With Expert

With the market changing rapidly not everyone knows wide investment options.

Hence hiring a professional can help you with your lifestyle planning.

  • They assess your current financial situation and future goals.
  • Address the major areas of financial concern: retirement, college planning, insurance, avoiding estate tax, etc.
  • Provide advice during unexpected times and financial disruptions.
  • Set up investment accounts and invest funds for you.
  • Suggest the right mix of financial vehicles for you, like insurance policies or mortgages etc.

To know more about financial planning and to get your personalized portfolio strategy contact us at wealth@iventures.in


Get Your Portfolio Reviewed By Team of Financial Experts at iVentures Capital For FREE.
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iVentures is a financial boutique firm that offers bespoke solutions in Asset Management, Credit Solutions, fixed income and Wealth Management.

Established in 2005, iVentures Capital has helped 2000+ families build their legacy.

And managing over 500cr of Investments for its clients.

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