3 ms·

That's a myth. Most people are rich because their parents were. Most of the rest is rich because they were/are lawyers or medical doctors. (For the super-rich,

That's a myth. Most people are rich because their parents were. Most of the rest is rich because they were/are lawyers or medical doctors. (For the super-rich, business and finance becomes more important. But for your average "middle-class rich", lawyers and doctors just dwarf their numbers. Business also has highly unequal outcomes). As to why this myth persists, I guess it goes well with American puritanical roots. Many possibly don't belief in a strict correlation, if not causality, of everyone's financial situation and their individual moral character, but still promote the idea. See also: prosperity gospel, Ayn Rand.

JMTQp8lwXL 7y ago
Fidelity found that only 12 percent of millionaires inherited at least 10 percent of their net worth-- 88% are self-made. https://money.usnews.com/money/blogs/on-retirement/articles/7-myths-about-millionaires https://money.usnews.com/money/blogs/on-retirement/articles/...
- algorias 7y ago
  That statistic sounds highly suspect: if I inherited $5M 30 years ago and am now wort $50M, do I count as "not having inherited my wealth"?
  - dsfyu404ed 7y ago
    Nobody ever got anywhere without at least some luck involved. I think people deserve credit for any wealthy growth above and beyond what you'd expect for the asset they started with.
  - AnIdiotOnTheNet 7y ago
    They say the first million is the hardest, so I imagine getting that for free makes the rest of it much easier if nothing else.
- ryandrake 7y ago
  “Being rich because your parents are rich” can happen by a lot more ways than inheritance. In addition to gifts at death, there are gifts throughout the parents’ lives, equity gifts (you can buy one of the family houses for cheap or live in it for free), fully paid Ivy League education, prep schools, the parents can finance a startup, provide low interest loans, etc. I wouldn’t consider any of these as “self made” but they are not inheritance.
- antisthenes 7y ago
  And? You can pay for someone's top university education (~$250k) and pay their food and rent for the first 10 years since they graduate (another ~$240k). Notice how there's no direct contribution to their net-worth.
  - JMTQp8lwXL 7y ago
    A top university education isn't essential to becoming wealthy. Saving habits likely have more influence. You can go to Harvard, and then secure a well-paying job, but if you're going to spend your income on a penthouse in Manhattan, you're not going to be saving anything. Is it a leg up? Sure. I hate to use anecdotal evidence, but I went to a virtually no-name CS school, and ended up in the top ~5% of the income distribution 4 years after graduating.
- JackFr 7y ago
  But the parent doesn't say that. It says that most people are rich because their parents are rich. Not because they inherited their wealth. Stable home life, good schools, good network, good attitude and a financial backstop in the event of disaster (which allows a higher risk appetite) are all things that correlate positively with becoming rich. Your parents can give these without a penny of inherited wealth.
  - smsm42 7y ago
    I guess it depends on the definition of "rich". "Stable home life, good schools, good network, good attitude" usually attributed to somebody being in the "middle class" and is not necessarily considered "rich".
  - JMTQp8lwXL 7y ago
    > It says that most people are rich because their parents are rich. Not because they inherited their wealth. Fair enough. It's an astute observation, but it's misleading to say the first sentence, yet not imply the second, since most people aren't going to read into it that deeply. You'd just say: "Most people who are wealthy are so due to their stable home life, good schools, good network, good attitude and a financial backstop in the event of disaster". Why would you lead with parent wealth? It pre-supposes inheritance without additional context.
lutorm 7y ago
Having a high income doesn't make you rich if you just spend it all... By definition, being rich requires spending much less than you make, unless you inherited it. Whether that counts as "penny pinching" is a different matter, but the ability to live within your means is certainly accessible to most people if they're willing to delay gratification.

JMTQp8lwXL 7y ago

Fidelity found that only 12 percent of millionaires inherited at least 10 percent of their net worth-- 88% are self-made. https://money.usnews.com/money/blogs/on-retirement/articles/7-myths-about-millionaires https://money.usnews.com/money/blogs/on-retirement/articles/...

algorias 7y ago
That statistic sounds highly suspect: if I inherited $5M 30 years ago and am now wort $50M, do I count as "not having inherited my wealth"?
- dsfyu404ed 7y ago
  Nobody ever got anywhere without at least some luck involved. I think people deserve credit for any wealthy growth above and beyond what you'd expect for the asset they started with.
- AnIdiotOnTheNet 7y ago
  They say the first million is the hardest, so I imagine getting that for free makes the rest of it much easier if nothing else.
ryandrake 7y ago
“Being rich because your parents are rich” can happen by a lot more ways than inheritance. In addition to gifts at death, there are gifts throughout the parents’ lives, equity gifts (you can buy one of the family houses for cheap or live in it for free), fully paid Ivy League education, prep schools, the parents can finance a startup, provide low interest loans, etc. I wouldn’t consider any of these as “self made” but they are not inheritance.
antisthenes 7y ago
And? You can pay for someone's top university education (~$250k) and pay their food and rent for the first 10 years since they graduate (another ~$240k). Notice how there's no direct contribution to their net-worth.
- JMTQp8lwXL 7y ago
  A top university education isn't essential to becoming wealthy. Saving habits likely have more influence. You can go to Harvard, and then secure a well-paying job, but if you're going to spend your income on a penthouse in Manhattan, you're not going to be saving anything. Is it a leg up? Sure. I hate to use anecdotal evidence, but I went to a virtually no-name CS school, and ended up in the top ~5% of the income distribution 4 years after graduating.
JackFr 7y ago
But the parent doesn't say that. It says that most people are rich because their parents are rich. Not because they inherited their wealth. Stable home life, good schools, good network, good attitude and a financial backstop in the event of disaster (which allows a higher risk appetite) are all things that correlate positively with becoming rich. Your parents can give these without a penny of inherited wealth.
- smsm42 7y ago
  I guess it depends on the definition of "rich". "Stable home life, good schools, good network, good attitude" usually attributed to somebody being in the "middle class" and is not necessarily considered "rich".
- JMTQp8lwXL 7y ago
  > It says that most people are rich because their parents are rich. Not because they inherited their wealth. Fair enough. It's an astute observation, but it's misleading to say the first sentence, yet not imply the second, since most people aren't going to read into it that deeply. You'd just say: "Most people who are wealthy are so due to their stable home life, good schools, good network, good attitude and a financial backstop in the event of disaster". Why would you lead with parent wealth? It pre-supposes inheritance without additional context.

lutorm 7y ago

Having a high income doesn't make you rich if you just spend it all... By definition, being rich requires spending much less than you make, unless you inherited it. Whether that counts as "penny pinching" is a different matter, but the ability to live within your means is certainly accessible to most people if they're willing to delay gratification.