NextGen’s Quest And Wealth Management’s Role

Charles Paikert

22 July 2022

Family offices, private banks, wealth managers and advisory firms who work with wealthy families sponsor scores of programs for NextGen family members. But their efforts may be counter-productive, according to Dr James Weiner, author of the just published Quest for Legitimacy: How Children of Prominent Families Discover Their Unique Place in the World.

“One of the primary objectives of these programs is to preserve clients and assets under management,” Weiner said in an interview with Family Wealth Report. “But if they just do that they will lose younger next generation clients.”

Children of prominent and wealthy families often struggle with deep-seated issues of identity, legitimacy and acceptance, Weiner explained. “My advice to the firms sponsoring these programs is to be aware that the struggle has nothing to do with wealth.”

The book has been published at a time when there is a multi-trillion dollar wealth transfer going on. The wealth management industry is wrestling with how to engage with NextGen clients and retain their business.

The quest for legitimacy is not about making money, according to Weiner, who is a psychologist and a family and private wealth consultant, but about “knowing who you are and what you want to manifest in this world.”

The problem, he maintains, is that children raised in high profile and high achieving households often experience “a pervasive feeling that they will never measure up” to their parent’s expectations.

Growing up in “a land of giants” and in the shadow of someone else’s success, these children feel intense pressure to achieve and match the accomplishments of the family founders. And even material success may not be enough if the individual hasn’t established his or her own identity with agency and power, Weiner cautioned.

What’s more, the next generation can be crippled by fear that people are taking advantage of them because of their wealth and prominence and, accordingly, find it very difficult to trust people outside the family.

The key to achieving legitimacy, according to Weiner, is what he calls “liminality,” a time of transition similar to a rite of passage that will include “breaking points” from the path set out by the family, allowing the individual to discover their own unique gifts.

The quest can be gradual, with no set time or duration, Weiner said. The key is the process of discovery along the way and self-awareness.

Recognizing and dealing with the often profound difference between the world of the wealthy family and the outside world is a major challenge, Weiner noted. NextGen children are often in a “tug of war” between those worlds, he said, but need to integrate what they learn internally to “take ownership of their life.”

Children of prominent families can also feel very isolated, and creating a sense of community can be one of the most important features of a wealth management firm’s NextGen program, Weiner said.

“Facilitating peer contact with others in the rising generation is very important,” he explained. “The dialogue shouldn’t just be about finance and leadership but about the experience of being on the quest and learning what others are doing about it. It’s really powerful knowing you are not alone.”