How come first-generation wealth creation is on the rise?

A significant trend in today’s dynamic economic landscape is the rise of first-generation wealth creation. Gone are the days where inheritance and legacy were the main routes to wealth. These were assets that include real estate, bonds, family businesses, stocks, and any other investments passed down by generation of a family to another.

Interestingly, a new generation of professionals and business owners with a variety of backgrounds are blazing their own trails to financial success. This set of people who are first-generation wealth builders are individuals beginning their financial journey without any available resources. More often than not, these people are starting from point zero without any form of inheritance.

Changes in societal attitudes to enhanced access to education and innovative technologies, as well as other key factors are propelling individuals from diverse backgrounds towards financial success.

Economic Shifts

Significant changes have occurred in the economic landscape. This makes it possible for people from all walks of life to start building wealth. Other factors such as globalization, the democratization of knowledge, and technological improvements have all been critical in levelling the playing field and increasing the opportunities for first-generation wealth creators to succeed. First-generation wealth creators have understood the global economic landscape and created enabling conditions that enable them to thrive and leave a legacy.

Role Models and Inspiration

The success stories of first-generation wealth creators such as Oprah Winfrey and Jeff Bezos serve as are powerful inspirations for aspiring entrepreneurs worldwide. These individuals have overcome obstacles, embraced failures, and have demonstrated resilience in the pursuit of their dreams, inspiring others to follow suit and chart their paths to financial independence.

Wealth Transfer and Intergenerational Dynamics

According to reports, the Millennial age is experiencing the fastest rate of increase in net worth. According to a Deloitte analysis (https://www2.deloitte.com/content/dam/insights/us/articles/us-generational-wealth-trends/DUP_1371_Future-wealth-in-America_MASTER.pdf), there will be a substantial intergenerational wealth transfer dynamic occurring, with over $68 trillion in wealth predicted to be transferred to the next generation in the United States alone by 2030. The mechanics of intergenerational wealth transmission are changing, placing more emphasis on meritocracy and self-reliance. Even though inherited wealth still matters in most situations, more and more people are forging their own routes to success without regard to family history.

Government Policies and Support Programs

Various policies and programs have been established by governments across the globe to promote entrepreneurship, small business development, and economic empowerment. These programs help aspiring first-generation wealth creators succeed by offering them financial support, advisory, regulatory support, and mentorship.

For example, 99.9% of all U.S. enterprises are small businesses, according to the Small Business Administration (SBA) (https://advocacy.sba.gov/wp-content/uploads/2021/08/2021-Small-Business-Profiles-For-The-States.pdf), underscoring the significance of government support for entrepreneurship and small business development.

Social and Cultural Factors

As perceptions toward achievement and wealth accumulation continue to change, so too has the rise of first-generation wealth creation been influenced by shifting social and cultural norms. Future generations are inspired by the stories of self-made people, which subvert traditional ideas of privilege and entitlement.

Observers believe that, most individuals can succeed, if their willingness to work hard reflects shifting perspectives on success and accumulating money.

According to experts quoted in a CNN piece, wealth generation is improving noticeably on a global scale and as it turns the corner, young people are discovering new avenues for accumulating wealth.

“I think the diversity of opportunity to create wealth has also grown — for example, there are YouTubers worth tens of millions. First-generation wealth creation is on the rise, as is the array of entrepreneurial routes to create it,” Mike Pickett, director of Cazenove Capital, is quoted to have said.

As more individuals embark on a journey of wealth creation, it is important to note that an enabling environment is vital for individuals to prosper.