Page last updated at 23:57 GMT, Tuesday, 28 October 2008

Children of wealth: Rich reflections

By Kevin Mousley
Producer, BBC Radio 4, Children of Wealth

Delegates at the Next Gens week
$40 trillion dollars is set to pass to the next US generation by 2040

Having too much money will never be a problem for most of us, but for those lucky enough to be born rich, life presents a very different set of financial challenges.

"Wealth gives you gunpowder and when you explode gunpowder, you can go in one direction or the other," said Will from California. "Either way, you are going to go very fast."

The real estate heir from the US was one of 55 rich young people gathered in London to reflect on their wealth - how to keep it, spend it or give it away.

It was all courtesy of Citi Private Bank, which laid on a week of seminars and fun for the children of some of their richest clients, the so-called Next Gens.

With the recent financial crisis, banks have become keener than usual to hold on to their cash-rich clients.

Research in the US, however, has found as many as 90% of inheritors switch banks on receipt of their parents' largesse.

Clear vision

But these were not the idle rich. Attendee Will was caught leaving a lecture at 1600 one day to catch up on his family's affairs at the "start of the working day back home".

The Next Gens, aged 19 to 29, came from 18 countries, where their families run businesses including telecommunications, civil engineering, and leisure.

Ahmed, from Lebanon, is currently studying at university in Canada and has a clear vision for the future.

"We have our troubles in the Lebanon, it is my intention to equip myself with all the business know-how I can, so I can return and help our economy. If people like me do not do that, then who will?"

He said he lived in a $600-a-month fourth-floor apartment with no lift and worked part-time for the Subway sandwich chain.

Delegates at the Next Gens week
Banks are getting keener to hold on to their cash-rich clients

Franchise owners moved him from peeling cheese slices to overseeing the accounts of six branches within days.

Peter Charrington, the boss of Citi Private Bank in the UK and Israel, said the group was worth "tens of billions of dollars."

Like most of those attending, Cameron's key concern was a desire to get across how ordinary he really was "as an individual".

Wealth's pressures

"The corporate world does not attract me. Thankfully, we do not have a family business as such, so it is not an option I will need to consider," said Cameron.

The issue you face is how we create meaning in our lives. The rich are no different - it is about what does my life mean and how am I going to contribute?

Randall Carlock
Insead business school

The option he has acted upon is an idiosyncratic choice of a music and theology degree at Princeton university in the US, with a year out in Argentina.

He said he mainly hoped to get "some good conversation" out of the week, but also to "get up to speed" on economics.

As the days progressed, it became clear that the attraction of the week was a simple one - the opportunity to kick back and chat frankly with people like themselves.

"I figured that this would be a great place to come and meet some people, " said Justin from New York, " and that we could really relate to each other."

Ungelie, a British Asian heir to a pharmaceutical business, explains the pressures brought by wealth.

"We were advised to make sure we choose the right friends and because my father was doing exceptionally well, you have to be careful about who you talk to, what you say to them," she said.

Come market meltdown and recession, there are still and always will be, some extremely rich families.

'True satisfaction'

By 2040, $40 trillion dollars will pass from one generation to the next in the US alone - the biggest such wealth transfer in history.

Delegates at the Next Gens week
Young, rich and gifted - but with their wealth will come responsibility

"The new generation is much more liquid in terms of business wealth," explained David Poole, director of business development at Citi Private Bank. "These people are more entrepreneurial in their outlook."

Mohammed, the scion of an Abu Dhabi hotel business, reflected on the meaning of money.

"It is only good the moment you spend it: a nice car, a fancy meal in a fancy restaurant, only then.

"If you want true satisfaction, then you must strive to do 'good'. And you can do that whether you live in tent or a mansion," he noted.

According to Randall Carlock, professor of family business at the Insead business school, these people were searching for something more fundamental than how to make the best of their fortune.

"No matter where you are in the West, the issue you face is how we create meaning in our lives. The rich are no different. It is about what does my life mean and how am I going to contribute?"

Producer Kevin Mousley and reporter Jim White recorded the event for a Radio 4 programme called Children of Wealth. It is on Wednesday, 29 October at 1100.

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