4 common ways families transfer wealth and how to avoid negative entitlement and problems.

wealth transfer
wealth transfer

When it comes to wealth, it can feel like a curse at times rather than a blessing. Making the wrong choices with your wealth transfers can have some long-term unfavourable effects on your family. Incidentally, the stress of managing assets in your lifetime and then beyond can feel complicated.

The biggest concern for families is granting a sense of entitlement. Families don’t want wealth to smother ambition, self-esteem, or purpose in the next generation. Still, the harmful effects of wealth transfers are often unclear to families when they sit down to work out their plans. 

When parents make informed decisions with a plan, they can avoid future problems. They ensure assets are distributed constructively and not destructively to future generations. Let’s look at four ways entitlement plays a considerable role when transferring wealth.

No Clear Plan 

Often no messaging or communication is given when wealth is shared. Families may offer wealth slowly or quickly or with no rhyme or reason. An unplanned, chaotic flow of wealth transfer might happen over a family’s concern that fears money will lead to entitlement behaviour.

Nevertheless, such behaviour limits the recipient from taking responsibility and planning their financial lives. It blocks them from making significant and essential investments in their futures. 

Due to uncertainty, confusion, and diminished empowerment, recipients may feel bitterness toward the money rather than gratitude. If they believe wealth needs to be transferred more rapidly but receive minimal messaging about why families may withhold wealth, recipients may feel hurt.


Wealth is given slowly or sporadically but with high messaging. It’s typically describing specific, ‘approved’ purposes for the wealth. 

For example, families might give wealth to buy a new house in a particular neighbourhood or for tuition for a specific school chosen by the progenitor. The giver uses this wealth transfer approach to control the recipient’s choices and behaviour through directives about what they can and cannot do with the money provided. Feeling supervised by the parent, the child may feel resentment, suspicious of what others are getting and if things are fair.

Some individuals who follow this approach prefer the child to work hard with the current amount rather than risk exposure to the riskier path that better speaks to their potential and identity. Many kids don’t realize their parents’ or grandparents’ intentions about the current transfer or that it’s a ‘test,’ so they chose inappropriately regarding their use of the wealth.


Entitlement is when family wealth is given generously to the next generation over their lives with minimal messaging.
Wealth is given proactively or simply upon request by the receiver. It is given free to use it as they wish, presumably hoping the beneficiary will use it wisely without much guidance, preparation or accountability.

These choices can lead to entitlement on the part of the receiver. Entitlement is a sense that one is owed privileges without responsibility or the need to earn them. This choice may damage their image in the family or their social network and suppress their motivation to pursue purpose in life. Should this happen, the progenitors bear some responsibility for failing to provide appropriate messaging with their transfer of wealth.


If wealth transfers are carefully and intentionally planned, recipients are more motivated to attain success. Recipients will make more impactful, purposeful, and thoughtful choices when there are clear guidelines and expectations.

With the proper education and preparation, beneficiaries can use the money to better themselves and positively impact the world. Feeling empowered and enabled with the funds to accomplish their goals, they understand the money offers them opportunities and provides certain benefits. They are free to pursue their passions, knowing they will meet their basic life needs. The wealth, transferred thoughtfully with thoughtful messaging, encourages recipients to stay engaged with their communities and not be disengaged. Regarding wealth transfers, we all want to leave enough for our children to do anything, but not enough for them to do nothing.


Families can avoid unintentionally misusing their wealth to control or create entitlement by being careful about what and how they give. They can make wealth transfer meaningful for their heirs by empowering them during the transfer process. More importantly, when parents and their heirs talk about wealth transfer in this way, the possible outcomes become more precise and meaningful.

Through greater understanding, potentially through communication with family meetings or with an advisor, families can achieve the best outcome for transferring wealth. An individual’s legacy will inspire them more toward their life-long purpose. Even better, that legacy will become a force for good, as intended.

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