Have you ever thought about why you save, spend, gift or invest money the way you do? If not, you’re not alone; most people haven’t. Whether you’re aware of your monetary behaviours or not, your “why” is likely directly tied to your monetary values. These are a set of beliefs and principles that motivate your financial decisions, and which can have a significant impact on your personal and familial financial success.

You may have heard of the “third-generation curse,” which indicates that most families lose their money by the third generation. This is likely due to a combined lack of financial education, awareness and shared values, and overall money mismanagement. Therefore, establishing shared monetary values, being vocal about them and ensuring your heirs share them, can help safeguard your wealth for generations to come.

Because values are complex; defining and getting your entire family to abide by the same ones can feel challenging. I’ve seen this hold especially true when wealth is passed on to grown children with spouses who have different values, and/or grandchildren and great-grandchildren who are further removed from the initial onset of wealth. Here are a few considerations to help get everyone on board:

Identify your own monetary values

Many people aren’t consciously aware of their monetary values or financial habits. These are typically subconsciously shaped by one’s upbringing, personal experiences and beliefs.

For example, if you grew up in a home where your parents were struggling to make ends meet, you may feel the need to be overly conservative with your funds based on fear that you won’t ever have enough. And while it’s certainly healthy to save and have enough set aside for potential emergencies, it could steer you away from taking calculated risks (such as investing a portion of your money), which could prevent you from benefiting from the power of compounding. On the flip side, if you were raised in a home where money was not a major source of stress and easily accessible, you may struggle more with overspending or delaying instant gratification.

These are certainly two extremes, but I call them out to emphasize that before you can actively define monetary values for your family, you must understand your habits and be intentional about making any necessary changes. You can’t change what you don’t know.

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