How to Protect Your Children From Wealth-Related Issues

One of the biggest worries of wealthy parents is that their affluence will hamper their children’s personal and social development. In some instances, privileged kids have grown into young adults who lack a sense of empathy and fair play and who believe their financial position absolves them of accountability. Parents can take some key steps to help avoid this outcome.

When Wealth Is a Risk Factor

“Affluenza,” the slang diagnosis often applied to such situations, can manifest in damaged relationships and social isolation. And it can mean depression and anxiety connected to a self-image that rests on financial status. Of course, countless affluent families have raised exceptionally well-adjusted children who enjoy the privileges of wealth while avoiding its potential drawbacks. Raising these kinds of young people isn’t an accident.

Fostering Empathy and Compassion

A seminal 2015 white paper, “Born to Give,”¹ offers well-defined actions parents can take to help foster grounded and well-rounded children. Nexus, a global organization of young philanthropists, impact investors and social entrepreneurs, cites research showing that fostering development of empathy and compassion is critically important.

The paper challenges the widespread assumption that individuals are naturally self-serving and argues that humans have, in fact, evolved to be caring, generous and eager for connection. In other words, we’re wired for empathy and compassion. Parents can help to encourage these traits, often in very simple ways. For example, the authors write, exposing kids to books and movies in which main characters encounter hardships and challenges can help them develop a sense of empathy and a desire to help others.

Setting a Good Example

Modeling empathetic behavior is another effective way to teach kids to see the world from other people’s perspectives. Parents can sensitively discuss the difficulties of other people, for instance, or personally perform services for those in need. They can engage in charitable giving, sharing the details with the children. Getting kids directly involved in generous activities is another way to foster their personal development. That could mean volunteering them to help build homes with Habitat for Humanity or mentoring disadvantaged pre-teens. These kinds of activities don’t just help curb affluenza. Research has shown that giving to others makes the giver happier.

The Importance of Emotional Security

It’s also crucial to foster open and honest connections among family members. Children from privileged families often feel that they can’t speak openly and honestly with their parents about money, emotions and other issues. Environments in which safe, supportive conversations are the norm allow parents to build trust with their children and promote healthy emotional development.

Breaking Out of the Bubble

Finally, it’s important that children of wealthy families get outside the social bubble of kids who share their background and privilege. Interacting on a regular basis with people from different places, different cultures and different socioeconomic backgrounds can help create a grounded and well-rounded person. Parents can make sure their kids experience diversity by enrolling them in clubs and activities with children from different backgrounds, for instance, or by encouraging travel to different countries and cultures.

We all want our kids to grow up to be empathetic, compassionate and well-rounded individuals. Affluence isn’t an obstacle for parents who understand the steps needed to raise healthy, happy adults.