Eric Siu explains why generational wealth rarely survives past the third generation. A Chinese proverb warns that fortunes disappear by then, and the Vanderbilts and Rockefellers prove it: later heirs lack the experience to manage what they inherit, so the money erodes fast.
When I think about this book, the whole concept of dying with zero, it's never really made sense to me in the beginning at least, 'cause I was like, okay, well, if I'm gonna make all this money, if I'm gonna do well in life and business, then wouldn't it make sense for me to give that to my family and have 'em give it to their families and just continue on the legacy? But the reality is when it comes to wealth, and there's a Chinese saying for this, that the wealth is basically completely lost by the 3rd generation. Yeah. And sometimes even by the second generation. When you think about the Vanderbilts, so Vanderbilts were very successful. I believe the Vanderbilts were involved with railroads and then you had Rockefellers who were involved with oil. And so the Vanderbilts were very successful and that fortune was basically completely gone in about 3 generations or so. They like to say that by the second generation, you're basically going to lose 70% of it. By the third generation, it's basically completely gone, 90% plus gone, right? It's because that future generations haven't really gone through the experiences necessary to understand how they can wield the power of wealth.
