As financial planners, we often find ourselves in conversations that stretch far beyond balance sheets and investment returns. One of the most sensitive discussions we have with affluent parents centres on the paradox of wealth: How do we raise children who remain driven, resilient, and grounded when our financial resources could so easily shield them from life’s challenges?
It is a conundrum we’ve witnessed repeatedly over the years. Parents want to shield their children from hardship, yet they fear that by doing so, they may rob them of the very drive and tenacity that built the family’s success. While wealth can provide extraordinary opportunities, we know that, without careful thought and planning, it can also erode resilience, weaken values, and diminish appreciation.
The parental dilemma
The generation responsible for building wealth has typically achieved success through a blend of sacrifice, discipline and calculated risk-taking. They know firsthand the sting of financial pressure, the long hours, and the setbacks that shape character. In many instances this generation worries, often with good reason, that their children – born into comfort – may never develop the drive and determination that propelled them forward.
At the same time, these parents ask: Why should our children struggle when we have the means to give them a better start? After all, financial security allows their children access to education, travel, experiences, and opportunities that they themselves may never have had—advantages that can set the next generation up for future success. The tension lies in how to provide support without smothering ambition.
The risks of over-providing
The first risk of over-providing is that of entitlement. When children never experience financial difficulty or financial limitations, they may grow to view privilege as a right, rather than a gift. This mindset can lead to complacency, a lack of gratitude, and an inability to truly value what they’ve been given.
The second risk is dependency. Adult children who rely on parental resources to fund their lifestyles may lack the skills to budget, save, or delay gratification. They may also delay important milestones—such as leaving home, buying property, or building careers—because there is no financial urgency.
The third risk is disconnection. Parents who provide significant wealth transfers during their lifetimes without proper communication often find that their children do not appreciate the effort behind the gift. Instead of strengthening family bonds, money can become a wedge—fuelling resentment between siblings or straining the parent-child dynamic. At its worst, money may also be used as a tool of manipulation, fostering unhealthy co-dependency rather than genuine connection.
The benefits of support
On the other hand, wealth can be an extraordinary enabler. It can be used to provide quality education, seed capital for a business venture, or the deposit for a first home that can launch children towards independence earlier than they could achieve alone. It can give them access to experiences such as travel, global study programmes, or advanced degrees that expand horizons and broaden perspectives.
Financial support can also offer freedom. It allows adult children to choose careers that align with their passions rather than being driven solely by financial necessity. For example, a child may pursue a career in academia, the arts, or social entrepreneurship precisely because they are not under immediate pressure to maximise income. When managed thoughtfully and communicated carefully, parental support can create conditions for children to thrive in ways not possible without it.
Striking the balance
From experience, we believe that the solution lies not in withholding wealth, nor in giving without boundaries, but in striking a balance between generosity and communication, overlayed with strategy and expectation management. We believe that several practical strategies can be considered:
- Teach financial literacy early: One of the greatest gifts parents can give their children is an early understanding of how money works. Financial literacy is not about creating child prodigies in investing, but about instilling respect for money and the discipline to use it wisely. Children who learn the basics of budgeting, saving, and investing from a young age are far less likely to squander wealth later in life. Just as important is teaching the principle of delayed gratification—helping children understand that waiting, working, and saving towards a goal often brings greater satisfaction and value than immediate indulgence. In this way, financial literacy becomes more than just knowledge; it becomes a framework for resilience, responsibility, and respect for the resources entrusted to them.
- Tie support to effort: Rather than providing unconditional financial assistance, structure support in a way that rewards effort and initiative. For instance, instead of simply buying a child a car, offer to match whatever amount they have managed to save towards it. If they aspire to start a business, you could offer to provide seed funding only once they’ve developed a credible business plan. Linking contributions to achievement not only reinforces the principle that effort precedes reward but also teaches accountability, perseverance, and responsibility. Children begin to understand that wealth is not a bottomless safety net but a resource that flows when accompanied by discipline and initiative. In this way, financial support becomes a catalyst for growth rather than a substitute for it, cultivating resilience and respect for what has been earned.
- Differentiate between opportunities and lifestyle: There is an important distinction between funding opportunities that build capacity and simply financing day-to-day consumption. Contributing towards education, professional skills development, or entrepreneurial ventures can equip children with tools to create and sustain their own success. On the other hand, subsidising luxury cars, designer wardrobes, or extravagant holidays can create dependency and blur the line between support and indulgence.
- Communicate openly: Silence around money more often breeds confusion, misinterpretation, and conflict. From our experience, families that avoid the topic of wealth can leave children ill-prepared for both the privileges and the responsibilities it brings. Parents should be encouraged to have honest, age-appropriate conversations that evolve as children grow – with these discussions not only covering the numbers, but also the values that underpin the family’s success – the discipline, sacrifice, and resourcefulness that created it. Transparency can build trust and foster a sense of shared responsibility, helping children see wealth not as an entitlement, but as a resource to be managed and stewarded.
- Model values, not just assets: Children absorb financial attitudes less from what they are told and more from what they observe. They notice how parents make decisions, what they prioritise, and how they respond to both abundance and scarcity. Demonstrating generosity, humility, and responsibility with money imparts lessons no lecture could ever rival. Acts of philanthropy, community involvement, and disciplined spending can demonstrate to children that wealth carries obligations as well as privileges. When parents model restraint in the face of excess, or choose to invest in people and purpose rather than status symbols, they embed values that endure far longer than material assets.
Ultimately, intergenerational wealth transfer is about far more than money—it is about the values and stories that give wealth meaning. Children who understand the sacrifices behind their inheritance, and the principles that guided its creation, are more likely to view it as both a privilege and a responsibility. The challenge for parents lies in striking the delicate balance between providing opportunities and preserving resilience—offering support in ways that foster independence, gratitude, and direction without eroding drive and purpose.
Have a super day.
Sue
