What Is Considered Old Money?
The concept behind the term “old money” is that of a family who has amassed generational wealth. That is, a family ancestor made a fortune in a given industry, managed it wisely during their lifetime, and taught their descendants how to do the same.
Someone who is considered to come from old money is someone who has been gifted money with conditions or is the beneficiary of a generational trust.
It’s worth noting that the term is applied to those who have descended from a family line that has been historically wealthy, and not those who have earned their money in the current or previous generation.
How Many Generations are Considered Old Money?
Wealth doesn’t become old money until it’s been maintained for at least three generations.
That means a granddaughter of a grandfather who has successfully managed the family wealth is barely considered old money.
Someone who’s in the fourth generation of a family that has generational wealth is unquestionably old money and is considered as such.
The reasoning behind the minimum of three generations to obtain the status of old money comes from the fact that successive generations have managed to preserve and grow their wealth over decades, even centuries.
What is Considered Old Money vs. New Money?
Much is made of the difference between new money and old money. Old money families view themselves as being refined and classy in contrast to their newly minted millionaire peers.
People who are in their first generation of wealth tend to go overboard with spending money as it’s their first experience with not worrying about going broke.
n contrast, old money is secure in their wealth, aren’t worried about the money running out, and grew up in surroundings that were luxurious, or if not luxurious, comfortable and never had to worry about meeting their needs.
New money feel that the world is their oyster with plenty of pearls for picking. They’re brash, talk about their money, dress themselves up in high-end brands and carry designer accessories with obvious brand names, buy flashy cars, and do anything they can to get people to look at them. New money tends to lack self-awareness about how they look to the public at large.
A French term, nouveau riche, is used to describe people who have just made their wealth in the first generation.
It’s used as an insult and to describe someone who has earned a lot of money, but doesn’t understand how to not draw attention to themselves in a negative way.
Does Old Money Mean Rich?
Old money is a polite way of saying that a family is very wealthy or rich. They’ve managed to keep large homes in the family for a long time (think of the Kennedy compound in Hyannis Port, Massachussetts), have managed to retain their wealth through economic ups and downs, and continue to grow their wealth as time goes by.
This is achieved by careful management of family assets, careful money management, cautious investments, and patience.
Senior members of the older generation also tend to control how the money is passed down to younger generations through the use of trusts and conditions.
Wills are frequently used to control how money is distributed to the generation that’s inheriting the estate. This is to ensure that all family members get their share while preventing them from spending profligately.
Some families ensure that the money stays in the family by the use of a trust that pays out the interest or a share of the income generated by the activities contained within the trust.
Sometimes a trust is so large that the amount of interest it accrues is sufficient to allow each beneficiary to live comfortably off the proceeds for their entire life.
How Much Money do Old Money Families Have?
Old money families have amassed large fortunes over the time of their existence, but how much depends on the sources of the family fortunes.
One family, the Pritzkers, are the family behind the Hyatt hotel chain. The family fortune is worth billions from the success of their hotel chain.
Other old money families with high net worth include the Carnegies, Fords, Disneys, Hearsts, and the Vanderbilts to name a few.
Most old money families are the beneficiaries of fortunes in the multi-millions and billions.
The actual value of these estates aren’t always public, but you can safely assume that they’re not going to be running out of cash any time in the near future.
What do Old Money Families Value?
Old money families tend to live a conservative lifestyle and prefer to maintain a low profile. As a general rule, they don’t like to draw attention to themselves unless it’s for a good reason.
The public’s perception of them is important because their family ancestor earned their fortune from the general public.
That is, people invested in their ancestor’s company, bought their products and services, and paid money to access their services. Flaunting generational wealth is seen as being in poor taste.
Dealing with a family member who’s acting out
They don’t care to draw attention to themselves, and usually won’t hesitate to publicly shame a wayward child.
An old money family works hard to preserve their fortune, which means all family members have to learn how to behave themselves, not spend heavily, be low-key, and maintain high standards when it comes to personal values.
The media is full of stories of children of wealthy families flashing the goods that they bought with their inheritance. Oftentimes, it’s seen as irresponsible behavior by the rest of the family.
It also brings unwanted attention to the family and its fortune. The family usually accepts the fact that young people need to sow their oats and enjoy what their money has to offer, but eventually the behavior has to pass before the family stops talking negatively about the rebel.
Philanthropy
Another area of value to old money families is philanthropy. Old money families have money that they will never spend in their lifetimes.
Giving money to charity, foundations, scholarships, etc., are ways for old money to make their mark on the world in a way that’s socially acceptable.
You may have never heard of the name that’s on the plaque of a school, but the money from that family enabled a building to be built and educate thousands of students in a state-of-the-art facility.
Respect for others
Members of an old money family are taught to respect those who are less fortunate from the moment they’re able to understand.
The members of the family understand that a good reputation is important, and part of that is attained by treating people from all walks of life equally.
Acting snobby or nasty to the public at large only serves to sink a family’s reputation, something that can cost them social standing.
