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We must be operating on different definitions. Generational wealth means you have enough money to meaningfully improve the lives of your kids and give them a leg-up on life. A million dollars is enough to buy a house for each of your 2.5 kids.

If getting a million dollars wouldn't affect how much money you can leave your kids, you already have generational wealth.

by ethagnawl11 hours ago|

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> If getting a million dollars wouldn't affect how much money you can leave your kids, you already have generational wealth.

Well said.

Where I live, one million dollars would allow me to pay off my house, open healthily sized investment accounts for my kids, pad my investment account, setup a trust and, overall, set my family up for a comfortable life in the future. I don't see how that isn't generational wealth.

by MeetingsBrowser11 hours ago|

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Generational wealth is where you can also do all of the above for your kids and potentially their grandkids as well.

Basically the bar is higher than "something you can pass down". It is enough that the next generation does not need to worry about making money either.

by asib12 hours ago|

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Generational wealth generally is used to mean something like you and at least your children can live very comfortably off of investment income for the rest of your lives, I.e. none of you have to work for a living. That’s why sibling’s def of 1.5-5m per child is much closer to the commonly understood meaning.

We can debate “live comfortably” if you want, but no 4.5 people are doing that from the investment proceeds of 1m.

What you are describing is kind of more like social mobility.

by MeetingsBrowser12 hours ago|

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The commonly accepted definition of generational wealth ranges from around 1.5 to 5 million per child.

by fwip12 hours ago|

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I can only find sources that define it the way I said, but I'm sure that folks who think a million dollars isn't enough to buy a house disagree.

by jimbokun11 hours ago|

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Generational wealth is generally used to describe not just a comfortable personal retirement but your children and their children and so on never needing to work if they are remotely responsible with the money.

by pessimizer11 hours ago|

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> If getting a million dollars wouldn't affect how much money you can leave your kids, you already have generational wealth.

Generational wealth is definitely not "affect[ing] how much money you can leave your kids." That's an equivocation - if you're leaving your kids a dollar, another dollar will "affect how much money you can leave your kids."

edit: you need a million dollars to securely retire at all, and that's if your parents, kids, or you don't get sick. If they do, a million is not only not "generational wealth" but it may not even last you three years.

by slfnflctd13 hours ago|

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I have to agree, yurishimo's assumption of returns is wildly optimistic.

At a more sane expected return of 5% annually, you get $50k a year to live off of to just keep what you have (or rather, watch it slowly erode in value due to inflation).

That is basically a one person income, maybe two adults if you pinch pennies and live in a crappy apartment or a low-end house in a midwestern suburb.

You can get a lot more lucky with a million bucks than you can with 10k if you gamble, but there are no guarantees. Risk tolerance is the most impactful variable. For those in the low risk tolerance group, I think you'd need at least 2 mil these days. And that's with being frugal, as well as probably not having much left over for kids.