5. Prepare heirs to manage wealth in ways to foster well-being.
Families that flourish do active financial parenting with both young and adult children. When children are small, parents teach them the basics of money skills: setting aside money for saving, spending, and sharing. As the children approach their teen years, the parents begin teaching them how to earn money and keep a budget. They allow and encourage adult children to grow up, and they seek out advisors to teach them about wealth management. Most importantly, the parents allow their children to experience natural and logical consequences for their actions instead of bailing them out financially. For example, if a child consumes an entire summer allowance in the first few weeks of the summer, the child will have to find a job.
