Leo Tolstoy wrote in the opening line of
All happy families are alike; each unhappy family is unhappy in its own way.
He was suggesting that for a family to be happy, it must successfully navigate a gantlet of challenges. These include education, marriage, parenting and career, spending and saving, healthy values and lifestyles. Failure in any one of these areas may doom a family. Although Tolstoy first published this book in 1873, his premise that a “happy family” faces constant challenges remains equally true today. Affluent families have many challenges, too.
Two terrific modern books that detail the extreme outcomes of wealthy families include Beer Money, A memoir of Privilege and Loss and The Rockefeller Inheritance.
Beer Money, by Frances Stroh, chronicles the decline of the Stroh Family and their beer empire, which once rivaled Budweiser and Miller beers. Their family was estimated to be worth nearly $9 billion in the 1970s.
Born in the 1960s, Frances Stroh and her siblings never inherited the brewing empire, which was sold to Pabst in 2000. By 2010, principal and income were gone. As her father Eric Stroh often said, “We should be a Harvard text-book case in how not to run a business.”
A retrospective on what went wrong would include Stroh family members managing the brewery without the necessary skills, compounded by bad investment decisions and excessive lifestyles of family members. To this list, add failed marriages, drug and alcohol abuse and lack of initiative by heirs … and the general decline of their Detroit community, where most of their lives and investments were focused.
At the other extreme is The Rockefeller Inheritance, by Alvin Moscow. Written in 1977, this is the biography of John D. Rockefeller, Sr.’s six grandchildren: Abigail, John, Nelson, Laurance, Winthrop, and David. These kids were among the wealthiest of their generation, yet they each achieved distinction in a different field.
One startling contrast between the two families was the importance of the Protestant work ethic in the Rockefeller family. While the Stroh children grew up swimming at the club, the Rockefeller children were shining shoes and performing other chores around the household.
I was struck by how many elements of the Rockefeller childhood are like many families today, including receiving allowances and dividing them into equal shares for saving, spending and charity. Families emphasized education and summer jobs. Children chose colleges based on their interests and competed for successes and favor in their parents’ eyes.
Both biographies share a similar theme: that growing up affluent makes the lives of children difficult in many ways. They are easily recognized, labeled for their wealthy parents, have trouble forming trusting friendships and find difficulty identifying a purpose in life.
Too often, wealthy families expect their financial success to make life better for their children. Reading these books may give you some ideas of how to help your children and grandchildren navigate the challenges they will face.