Healthy, wealthy and wise

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We’ve all heard the stories of poor little rich boys and girls (and men and women). They have every material advantage but are unfocused, unsuccessful or unfulfilled in relationships and careers. Access to the finest education, opportunities for travel, career and global connections— all of which come to them through their family’s financial largesse— doesn’t seem to make them happy.

“Wealthy people can get away with things that don’t allow them to grow and acquire a sense of themselves,” says Peter A. White, a New York-based consultant to U.S. Trust, Bank of America Private Wealth Management. White, who is also an educator and wealth management adviser, will give a lecture titled “Wealth & Happiness: The Effect of Affluence on Families and Children” on April 15 at Roland Park Country School. “You can see people in their 20s, 30s, 40s, 50s or later who have never been forced, or have never had the opportunity, to take charge of their lives as adults. … They rely on pleasures that money can buy, yet the interior experience of life is not a very pleasant thing. Their lives can turn out to become meaningless…”

Style asked six wealthy Baltimore parents to talk about their own experiences of growing up— and how they’ve raised their affluent children to avoid the classic pitfalls. Since none wanted their real names used, we’ve given each parent a pseudonym.

Change of course
Shari, a 50-something mother living in Baltimore County, was raised by one of four children of multi-millionaire parents whose names appear on hospitals, art museums and college buildings in New York, Massachusetts and Israel.

“I always knew my family was wealthy,” says Shari. “When I was 12, I was buying a new pair of skis, and the salesman asked me how much I wanted to spend, and I said, ‘It doesn’t matter how much they cost— my mother will just want me to have the best ones.’ I was in a bubble. When we went to visit my grandparents, it was like visiting the king and queen of England, with chauffeurs, cooks, gardeners and tickets to everything imaginable. We would eat at The Four Seasons, and we developed tastes for escargot and filet mignon. We ordered the most expensive thing, because it must be the best.”

While Shari’s mother flitted from interest to interest, shopped or traveled, divorced, married, divorced and married again, Shari and her three siblings were cared for by a Monday-through-Friday housekeeper. “My mother was clueless,” Shari says. The children made their own decisions about what school they would attend and turned to the housekeeper, even calling her at home, for lost homework assignments and shoes. Shari was a voracious reader and in the Nancy Drew series and books by Frances Hodgson Burnett and Madeleine L’Engle she discovered models of stable households. “I knew what I was experiencing was not the healthy lifestyle,” she says.

As a teenager Shari took the initiative to learn about managing money, asking to open a bank account when she turned 16. Then, at 18, she began dating a boy, Bruce, who had worked in his family’s business since he was 13 and had had a solid middle-class childhood, with devoted parents, hard work and a religious life. After graduation, the two married, went through graduate school and had three children. A small trust fund from Shari’s grandfather helped them get started, but they lived on Bruce’s salary.

“I followed my husband’s lead when it came to raising the children, assigning chores, giving allowances,” says Shari, who made a point not to repeat the mistakes of the past. “Bruce started talking to them about money when they were young— what to buy, what not to buy, and to save, save, save. We always talked about money, and we never hid from the kids what our financial situation was. We were contributing to charity, and we were saving, and we had no compunction about saying, ‘We can’t afford that.’”

Unlike her own parents, Shari and Bruce were fully engaged every day of their children’s growing up; there was no housekeeper. If Bruce was traveling, he called home and talked to his children. Shari was home after school. When she traveled with Bruce, his parents stayed with the children.

Because Shari and Bruce lived a religious life, they wanted to ground their children with a solid Jewish education before attending non-sectarian, private high schools. After Shari’s grandfather died, they used some of her inheritance to help pay for private school and college tuitions. When their children graduated from college, Shari and Bruce gave them the remaining money in their college funds, which the children will use for graduate school or to defray expenses while working toward advanced degrees.

“They are very frugal,” Shari says. “They already give back to their schools and to causes they believe in.” One is in law school and married. Another is preparing for medical school, and the third is about to graduate from college. No doubt they’ll pass on to their children the sense of responsibility, fiscal and otherwise, they learned from Bruce and Shari.

A legacy of connection
“It was really important to both Ned and me that our kids be very well aware that others living in their community and around them were struggling on a lot of fronts—emotionally, financially, whatever,” says Lucy, a 60-something Baltimore City activist. While she was from a solid middle-class family, Ned’s family had had family money on and off, for generations.

When her four children were still young, Lucy volunteered with troubled children, sometimes inviting them to share in family gatherings. Later she had a career in health care, serving city children. Ned, an investment banker who had enlisted to fight in Vietnam right after he graduated from college, undertook hands-on volunteer work, bringing the children with him when he visited city neighborhoods or taking an entire choir to baseball games and buying all of them hats or rain jackets.

“They knew from a very young age how generous their father was, not just in terms of his time, but with anybody and everybody,” says Lucy. “They saw the joy of giving and sharing what you have with others, and that it’s not so much what you get.” Ned wanted the children to be aware of their privilege, not blind to it. He told them that their good fortune began with an accident of birth, and that the things they had were blessings, not entitlements.

One sweltering evening, Ned and Lucy’s three oldest children were whining about the heat in their un-air-conditioned house, begging to go back to the country club, where they’d been earlier in the day. “Get in the car,” said Ned. He drove them in his tiny Chevette deep into the city where people were sitting on their stoops, cooling themselves with handheld fans. Ned didn’t have to say a word this time or any of the other times he drove the children downtown after complaints that they didn’t have something their friends had. Other times they had to earn money baby-sitting or pet-setting to buy things like ice skates.

Though Ned and Lucy sent their children to private school and summer camp, they also sought to expose them to experiences that would give them real-world perspective. A favorite trip involved, first, a raft trip down the Rio Grande River and, second, a week spent in Mexico without electricity or running water. They pumped water and heated it and poured it into a big Mexican tile bath. They all rode horses and grilled. “At night all we saw was stars,” remembers Lucy. 

These days, Lucy contributes to her grandchildren’s education and tries to give each of her adult children funds every year that will help them as parents and in their careers as a teacher, doctor, writer and public health worker who continue the family tradition of reaching out.

Old money
“The issue of money never came up when I was a child,” says Rob, a 60-something Baltimore County resident who is the fifth generation of wealth. “My parents didn’t talk about money at all. … There was no conscious recognition, ‘Oh boy! I’m wealthy.’ But I knew that we weren’t poor.”
 
At the boarding school Rob attended, he had certain amounts he could draw on, but “I didn’t have any free money that I could run around with,” he remembers. At home, his parents’ spending never seemed excessive, yet there was never an overpowering sense of frugality, either. “If there was something needed, we could do it. … I never had a sense of any wild sprees or any preening that one does to show off, but I was not starved for things; no hole needed to be filled with things.”
 
Rob didn’t have a summer job when he was a teenager, and usually his own children didn’t either, something he regrets. “I wish their mother and I had required them to,” says Rob now. “Earning money through your own hard work, even if you have no fear of losing your food and shelter, is a good experience. Priceless, in fact.”
 
As his own children grew up, he gave them allowances, but often found it difficult to resist the urge to spend on them. “It’s always the easy thing to do to buy the kids something,” he says. “It’s always harder to suffer their unhappiness, even if the lesson would be a good one. … Money can be used to coddle and it shouldn’t be.”

Just as his own father had, Rob worked hard when his children were young. He attended law school while he worked full time and later, when he came into some family money, Rob reduced his workload. “Perhaps that wasn’t a good example for my children,” he says. “I could have been more productive professionally, although I was able to spend more time with them, which was a good thing. Before that, when they were younger, I had not done as much as I should have.”

As his children grew up, Rob constantly reminded them: “We are fortunate. You are fortunate. But if you rely on inherited assets, you will join many other people who are in their middle years who have accomplished nothing, who have lived off the skill and hard work of their forebears and have great regrets.”

At one point, Rob says he spent extravagantly, buying what he wanted, invading the principal of his inheritance for fancy trips, but still never going into debt. “I regret having invaded [the principal] for frivolous things,” he says. “The idea previous generations had of not invading principal is very sound.”

When his children turned 18, each inherited a moderate amount. “That way they learn to manage it, and understand if they spend it, it won’t be there,” Rob says. As they grew older, he and his family gave them more, but he sought to do so without making his children dependent on the money.  “I didn’t want to poison the relationship of parent and child over time, so that they depend on the little amounts [of annual gifts]. I don’t care how hard you try, over decades if you receive gifts, you do depend on them.”

He continues to urge his children to rely on their own assets, hard work and their talents to support their needs. “If you have not developed the skills to survive, you have nothing to fall back on,” he says. “Assets not acquired by you can vanish overnight. Inherited wealth can be like welfare; you can be dependent on it. … It may not be the federal government, but instead, your ancestors, who worked hard and stored up their wealth, and their love.”

In the footsteps of kindness
“My father said the hard thing about having money is that more is expected of you. And more means kinder. You have to use it that way,” says Anne, a mother, grandmother and fifth generation of wealth who lives in Baltimore City.

Anne’s mother never talked about money— “that was tacky,” she says— but Anne first realized her family was well off when they built a big swimming pool. “I always thought that Red Cross size pool É was for the neighborhood.  I didn’t think of it as our pool,” she says. “Mother wasn’t a showy person; she kept a key hidden in a birdhouse so that anyone who wanted to use it did. They didn’t have to ask.”

Her mother, who had a Quaker background, did not give her four children more toys or more allowance than anyone else, and she herself wasn’t interested in acquiring possessions. “There was nothing she couldn’t afford. She didn’t want much,” says Anne. “I feel that way now. I don’t want a fancy watch. They tell the same time as a regular one.”

Anne’s parents’ generosity did not limit itself to their own neighborhood. Her mother did volunteer work at the hospital and with the Junior League. Her physician father would take a load of manure or anything else people wanted to give him in return for an operation they couldn’t afford. As a family, they provided Christmas and birthdays for the family that ran their farm outside of town. Her father even sent one of that family’s children to college, a fact that neither Anne nor her siblings knew until well after his death.

“My parents were so kind,” says Anne, who follows in their footsteps both by giving grants from a family foundation her husband established and in personal encounters. She met a young nursing student while taking pre-nursing classes and ended up sending her through school. She tutored a 6-year-old, then funded her higher education, attending all functions in which the girl participated. “I think it’s power that corrupts, and if you use money as power, you’re dead,” says Anne. “If you use money constructively, it’s empowering to someone else.”

With her children, Anne followed her parents’ model, adopting a family through a city organization and making meals at home together to take to an elderly neighbor. “I never wanted my children to be happy,” she says. “I want my children to be useful. The result of usefulness is being happy.” The overlay of Quaker simplicity continued with birthday parties at home every other year. These parties featured a homemade cake and nothing more elaborate than an occasional clown, magician or trip to the circus.

Anne and her husband gave modest allowances, which the children mostly saved to buy items that cost more than she and her husband would spend.  One daughter, for example, wanted a pair of $40 shoes. “We only spend $20 for shoes,” said Anne. The daughter was saving up for those shoes when another family took her to Florida, and the child came home wearing the shoes, compliments of her friend’s grandmother.

Anne is now teaching her grandchildren the family ethics about wealth.  Recently, she asked one granddaughter, “Have you ever felt that tingle of joy you get when you share?” “Not yet!” answered the little girl. When the girl wanted a second American Girl doll, Anne thought it unnecessary without an occasion. It’s better to wait until her birthday,” advised Anne, who had, years ago, refused to give her own daughter a car just because she wanted it. “There are more subtle things to teach, more to be gained, by waiting.”

Because they love the scratch-off lottery, Anne plays it with two of her grandchildren. When they won $6 recently, she told them $1 had to go to something outside of the family. The same little girl who wanted the American Girl doll said quickly: “Helping animals!” 

It’s not about stuff
When it comes to “things,” the three children of Margaret and John, a young middle-aged Baltimore County couple, both from family money, are not that interested.  “Maybe it’s because they’re boys, but they think it’s cool to have a car with 100,000 miles on it,” says John, whose children have watched him pack brown bag lunches for the family when they’re at ski resorts. “That’s from my parents,” he says, and from a New England sensibility heavily reinforced by an old-fashioned, technology-free, summer camp where John, his father, and now his sons have attended for years. “One guy showed up with scuba gear and a fancy camera, and the boys thought it was crazy,” says John. “It’s not about stuff.”
 

The same philosophy is shared by his wife, Margaret, who when growing up asked if her father didn’t want to re-do the curtains or buy a fancier car, only to have him say a resounding “No.” “He didn’t want to have all the bells and whistles,” she says. Margaret has been the one to tell each child: “You are never going to have a TV in your room!” when they’ve come home from houses where kids did. And although they could easily afford to enlarge the bedrooms in their home, Margaret and John choose not to. One son often jokes that his bedroom is about the size of a relative’s closet.

When the boys complain they’re cold because the thermostat is set at 60 degrees, Margaret says, “Go put on a sweatshirt.” She’s glad to give them money for lunch but not for toys— “those can wait for their birthdays,” she says.  All of this is part of her hope that the children don’t have “that weird sense of entitlement” she can’t stand seeing among some private school children.

If the boys want money, they go to their dad. “He has the softer wallet,” says Margaret. But not that soft. The older boys have debit cards, not credit cards, that draw from savings they’ve earned. If they ask for money, Margaret and John always ask: “What do you need the money for?”

Each child has begun working in the summer at age 16. “My father worked three or four hours every day even when he was 80. Margaret’s father worked every day until he died,” says John, who works long hours while Margaret has a full schedule raising the boys and doing freelance work.

At the boys’ private school, service has been a part of the school since its founding, as has a wide diversity in economic backgrounds. John and Margaret’s oldest son went to Mississippi twice to help victims of Hurricane Katrina, and the middle child, after seeing the homeless at St. Vincent de Paul, said he wanted to do something to help. That began a family tradition of making 150 to 200 sandwiches at Christmas to hand out.

For years the sons have been heavily involved in sports and rec leagues. “Except for shoes, we normally get our sports equipment at Play It Again Sports [where used equipment is sold] and there’s a lot of the hand-me-down thing, too,” says Margaret.

When it comes to the future, the parents think children are ready to inherit when they are somewhere between 30 and 50 years old. “We would never assume our children wouldn’t be working. If one chooses to pursue a less lucrative career, we may be able to help him do that,” says John. “We’d like to create a nest egg they can tap into and say, ‘This is for a down payment on a house, not for a fancy car.’”
Not too long ago one son was overheard saying, “If I had a nice car now, I wouldn’t have anything to look forward to.” Undoubtedly he’ll earn the money to buy that car himself.

New and old
“When my father died, we were left penniless,” remembers Davis, a 50-something banker whose father and grandfather had both been bankers. “Before my father died, I had no idea we were affluent. It took losses to realize what affluent and poor really meant.”

At age 15, Davis, who lives in Baltimore City, went to work to try to support two siblings and his mother, a concert pianist who had never worked a day in her life. “I lied about my age,” he says. “Whether it was lifeguarding or working at a drugstore, it was to support us. We got Social Security, welfare and food stamps. I was on Aid to Families with Dependent Children.”

Davis worked after school and on weekends and was on track for management training in the drugstore chain. “There was a point where there was a decision: should I continue to work for the drugstore chain? Everyone encouraged me to do that. Or, do you go to college and do something traditional? … Having reference points— what my father, grandfather, uncle did and what my friends had done— were a motivating factor. I thought, ‘I can do it, too. I’m not going to stay.’” He went to college as a scholarship student. “I was working or in school. No football games. It was a different world.”

During his senior year, Davis researched 100 companies, sent personal letters to individuals at those companies and landed a job at a prestigious international bank. He started work in one of his father’s old suits with what he describes as a huge inferiority chip on his shoulder. “There were 25 of us in the training program. They were all interesting people, brilliant or not, most from means, most expected to be there. The difference between ‘expected’ and ‘having to work for,’ is light years. I was the least educated person in my program. I was a token, and I still don’t know how I got that job. There was no way that I wasn’t going to work harder than anyone.”

With a beginning salary of $15,200 a year in 1981, Davis felt like the wealthiest guy in the world. He also found real role models. “I worked my butt off and good things happened.” In five or six years he paid back his college loans and started giving back $1,000 a year to his college. “They took a risk on me I can never forget.”

At work, Davis met his wife, Jean, also an investment banker but one who had gone to a prestigious boarding school and an Ivy League college, one who was the eighth generation of wealth. “My grandmother and great-grandmother had chauffeurs,” says Jean. “I knew we were wealthy, but my mother, who came from a family whose wealth was self-made, said that was their lifestyle; this was ours. We had no drivers.” What they did have was a strong Quaker background, one in which inheritances had been frugally preserved. “Because of the Quaker overlay there was a personal responsibility for others.” For example, a family estate on Long Island was sold in 1929 so the family could help out people who needed jobs and loans.

The tradition of service continues today as Jean and Davis, through their family foundation, positions on community boards and hands-on service with their two children, support health, education, arts and culture. In spite of a privileged lifestyle, Jean was determined her children would not contract the “affluenza” she saw rampant in the ‘80s, with kids having too much. “I never wanted my children to have that disease. … I told my children that talking about money or your stuff doesn’t make you a better person. In the Depression, the only thing you were certain to have in your possession was your brain. It could be taken around the world. You can’t take your stuff with you.”
 
Their oldest child has underplayed his comfortable situation, so much so that his college buddies seemed surprised to see his massive family home. “They had no clue,” says Davis.

While Jean and Davis don’t dwell on stories of their past, pieces come out, including the story of Jean’s grandparents hiring a man during the Depression as their chauffeur then supporting his son, who became the first African-American in the State Department.

Decades later, when Jean’s oldest was 16, he called a family meeting to figure out ways to help victims of Hurricane Katrina. “The children did all of the research. They drove the giving and the solution,” she remembers. “The mathematical one suggested we give 1 percent of the total assets of the foundation.” Though that was a tough proposal given that pledges were already out to many organizations, Jean and Davis did not say no.

“It was a proud moment,” says Jean. “I felt we were at a good point vis-à-vis ‘affluenza.’”

Peter White speaks on “Wealth & Happiness: The Effect of Affluence on Families and Children” Wednesday, April 15, 6:30 to 8 p.m. at Roland Park Country School, 5204 Roland Ave. Tickets, $35. Call 410-323-5500 or rpcs.org.

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