According to statistics, the average age of the richest people on the Hurun 100 Rich List in 2008 was 48.3 years old. According to Chinese practice, 60 is the retirement age. Therefore, it can be predicted that in the next 5 to 10 years, China will soon usher in a peak period for the transfer of folk wealth from the first generation to the second generation. How to promote wealth in the hands of the second generation, or at least not squander it, will become a topic of concern. Thirty years ago, when we talked about the word "inheritance", I'm afraid many people would not think of the intergenerational inheritance of personal wealth, because most people at that time did not have any huge property to leave to future generations. But today, 30 years after the reform and opening up, when our society has experienced explosive growth in personal wealth, we find that those pioneers who walked at the forefront of market-oriented reform have accumulated huge personal wealth, which has far exceeded their own needs for a prosperous life. Faced with the wealth that "life does not bring, death does not bring", these first group of rich people in contemporary China naturally thought of passing on wealth to their next generation. Wealth inheritance will enter the peak period To leave your wealth to your children, you only need to go through a simple legal procedure. But the problem is how to effectively inherit wealth. For the first generation of wealth creators, their highest requirement is to let the wealth be carried forward in the hands of the second generation, and the lowest requirement is not to let the wealth be squandered in the hands of the second generation at an abnormal speed. Since the systematic transformation of industrial and commercial enterprises after the founding of the People's Republic of China, all the family enterprises that existed in Chinese history have disappeared. Only a few time-honored private enterprises can trace their history back to 1978, so today's private enterprises are almost all new. For this generation of groundbreaking wealth creators, when they started their business from scratch when they were poor, most of them did not expect to accumulate such rich wealth today, let alone consider the issue of wealth inheritance at the beginning. When they realized the importance of this issue, they were embarrassed to find that modern China, which has experienced social unrest for several times, has not yet had the opportunity to breed an example like the Kennedy family or the Rockefeller family - in other words, modern China lacks successful cases of wealth inheritance that have gone through generations for reference. According to statistics, the average age of the richest people on the Hurun 100 Rich List in 2008 was 48.3 years old, and the rich people over 50 years old are everywhere. According to Chinese practice, 60 is the retirement age. Therefore, it can be predicted that in five to ten years, China will soon usher in a peak period for the transfer of private wealth from the first generation of entrepreneurs to the second generation of entrepreneurs. Therefore, the inheritance of wealth will naturally become the focus of the first generation of wealth creators. This problem is particularly evident in Zhejiang, Guangdong and other southeast coastal areas where China's private economy is the most active and private wealth is the most concentrated. Chen Ling, director of the Family Business Research Institute of City College of Zhejiang University, once conducted an enterprise survey in 8 counties and cities in Zhejiang Province. He found that more than two-thirds of the 312 enterprises surveyed were family businesses, "According to the data recently released by the Wenzhou Banking Regulatory Bureau, Wenzhou alone has 150 billion yuan of private capital. It is unprecedented that such a huge amount of wealth will be transferred from generation to generation. In the next 10 years, more family businesses will be handed over than ever before, and the problems of wealth inheritance and transfer will become increasingly prominent." Chen Ling said so. Wealth generation is a worldwide problem When it comes to the inheritance of wealth, we naturally think of the old Chinese saying: "Three generations are not rich". The logic behind this sentence is very simple: the first generation of people, through entrepreneurship to achieve brilliant career, must be inseparable from the entrepreneurial spirit of hard work. Once they become rich, they naturally hope to make their children live better. In particular, the traditional concept of Chinese parents is to leave misery to themselves and happiness to women. As the saying goes, "No matter how hard you are, you can't be hard on your children." Therefore, it is inevitable that their descendants will develop the habit of living well. Their motivation and hard work spirit are often inferior to those of the first generation, and their wealth can only be reduced day by day. Unfortunately, the wealth accumulated by the ancestors will be squandered at an unusual speed when they meet the sons and daughters of the black sheep. In fact, the problem of inheritance of wealth from generation to generation, represented by family businesses, has not only troubled the rich in China, but also been a worldwide problem. Portugal also has the saying "rich farmers - noble sons - poor grandchildren". Germany has three words "create, inherit and destroy", which are used to represent the fate of three generations. In the United States, only 30% of family businesses can exist in the second generation; Only 12% still exist in the third generation; Only 3% still exist in the fourth generation and beyond. Although the "second generation" may not be all black sheep, black sheep are easy to be born in the "second generation". According to a survey by a social organization in the United States, 70% of the bankrupts in the United States are "the second generation". The reason for bankruptcy is not that there are too few material resources, but that there is too much or even too much supply since childhood. However, people will be happy only when supply and demand are in balance. Over supply can not satisfy them, but let them lose. Because there is no demand, there is no power. When there is nothing they need to strive for through their own efforts, they will lose their goals in life and no longer be willing to work hard. This mentality eventually led them to the abyss of bankruptcy. In other words, for the "second generation", wealth may be an anesthetic that helps them to reach a higher level on the basis of their parents' generation, or it may also make them lose their motivation. "The second generation" has both advantages and disadvantages To study the inheritance of wealth, we must have a clear understanding of the second generation of wealthy families. Although the inheritance of wealth is a worldwide problem, the second generation of rich families is not without merit. They often have inherent advantages and disadvantages. First, let's look at the advantages. The second generation of rich families can often receive good education when they are young. Most people can also study abroad. The international education they receive provides them with a broad global vision and advanced thinking mode, which can help them keenly perceive the development trend of the world and seize the fleeting business opportunities. The capital, experience and network of their parents provide excellent conditions for their entrepreneurship. As we all know, the biggest dilemma faced by young people in starting businesses is the lack of the first start-up capital. They are creative but have no power to turn it into productivity, while the second generation of rich families need not worry about capital issues. At the same time, their parents' experience in shopping malls can help them avoid many detours on their entrepreneurial path. In addition, the relationship between parents has accumulated rich resources for the second generation. Then look at the disadvantages. In addition to the power of wealth creation that the second generation of rich people generally lack, the lack of frustration education is also their inherent fatal injury. Compared with their peers, they have been placed at a high starting point since childhood. Most of them have been sent by their parents to foreign famous universities for further study, and have directly become the right hand of their parents after graduation. A high starting point would have been helpful for foresight, but it did not experience the test of failure and frustration after entering the society like other peers, did not experience the struggle at the bottom of the enterprise, and did not experience all kinds of bumps and bumps and wind and rain in the society. Therefore, it is very difficult to successfully inherit the family business. Let the wealth pass on smoothly It is the greatest wish of wealth creators to transfer wealth to the second generation and develop it in a sustainable and healthy way. Specifically, it can be divided into inheritance of property and inheritance of career. In contrast, inheritance of assets is easier. In addition to giving assets directly to children, Financial experts also suggest that we can learn from the way of property trust commonly used in western developed countries to ensure the security and continuity of property transfer. We will introduce this way in detail in the next article. Although the business of personal property trust in mainland China has not yet been carried out, parents can also draw on its core ideas to build a trust model designed by themselves. As for the inheritance of career, its difficulty and complexity are much more difficult and complex, which requires parents to consider comprehensively according to their children's interests, hobbies, temperament and expertise, and consciously strengthen the cultivation of various aspects in the early stage, including enabling them to have positive and healthy life values, have the ability to withstand setbacks, and have the motivation to continue operating. Of course, in many cases, it is difficult to separate property from business. Property is the result of business operation, and the sustainable development of business is the guarantee of property sustainability. In this case, experts suggest that parents might as well make a portfolio of property inheritance as a portfolio. One part of the wealth is fixed in the form of property trust, and the other part of the wealth is retained in a going concern enterprise. This can ensure the inheritance of wealth in two ways at the same time, And we can determine their position in the enterprise according to their actual ability, whether they are directly involved in the operation or just as shareholders to receive dividends. Since wealth inheritance is a worldwide problem, it needs some special means to solve it. In this regard, the innovation of financial instruments also has much room for development. I believe that our financial institutions will not miss the opportunity, and some financial instruments suitable for Chinese characteristics will be created in the near future.