What is Generational Wealth & Who Has Access to It?

by Angelica Imhoede

Generational Wealth? What is that? How do you get that and where does it come from? These were all questions I asked when I first heard the term in college. After doing a little research on my own, I realized there was more to this concept of generational wealth and how it all started.  

History of Generational Wealth in America

Let’s see where shall we start? Generational wealth’ was once referred to as “old money.” In most societies, there were the bourgeois, the affluent, and the wealthy upper class. These were the people who had wealth that had been passed down generation from generation. They would inherit things like land, property, gold, and other material items of value. 

Then there was the rest of the people who were often lower class or poor! At this time, we have to understand there was no middle class; in fact, this concept of the middle class didn’t emerge until the 18th century because land no longer became the only source of wealth. The 18th century introduced the Industrial Revolution, which changed a lot of things for the lower class. Trading goods and manufacturing became very common, and people began creating businesses based on products they made or traded in an open market.

With the emergence of the middle class, the term old money now known as generational wealth began to materialize in the wealth-building process. Regular every day, middle-class people could build businesses, acquire property and assets. These people often have inheritance or trust for their descendants and would pass them on generation after generation. 

This follows the same concepts of today. As someone who is most interested in creating a legacy for my child(ren), I’ve often thought about what it would take and what it would mean.

Modern Generational Wealth

You see, we live in a time where you actually can get access to information at your fingertips. Now I would still like to preface this with race and ethnicity play a huge role in how easily generational wealth is obtained. We’ve seen situations, especially in the United States, where due to discrimination and racism, all races have not been able to prosper in the same way, if at all. Luckily within the last 20 years, we have seen a push across all underrepresented groups to increase their wealth with more policies and regulations around equality.

A few months ago, I created a post on my Instagram about how America’s median income has increased for all races between 2018 and 2019.

  • Asian Median Income increased to $97,174 in 2019 from $87,194 in 2018, an increase of $9,980 
  • White Median Income increase to $76,057 in 2019 from $70,642 in 2018, an increase of $5,415 
  • Hispanic Median Income increased to $56,113 in 2019 from $51,450 in 2018, an increase of 4,663 
  • Black Median Income increased to $45,438 in 2019 from $41,511 in 2018, an increase of $3,627 

This averages to $68,700 across all ethnic groups. Of course, there can be more done, specifically for the Hispanic and Black community. 

However, it still helps provide an overall picture that wealth is still trending up, and thus more wealth creation is being generated across minority groups more than ever before.

What are the steps to building generational wealth?        

That takes us to our steps on how to build generational wealth no matter who you are. Let me break it down below in five primary steps!

  1. Owning Assets: An asset is an item of material that appreciates over time; this includes investments, inventory, real estate, land, business, paintings, etc. Owning an appreciating item such as the items I listed will help grow your wealth over time. Not to mention you can pass it down in your will or estate once you die. 

The easiest way to do this: Buy a house or property. Having any real estate helps create value because property appreciates over time. We live in an age of low-interest record rates, so if you can, buy now. 

  1. Investing: People can invest in a lot of different items these days. Some examples would be stock, real estate, gold, mutual funds, ETFs, etc. Obviously, like most things, investing comes with its own set of risks that everyone should be mindful of when participating. However, with the S&P 500 out-performing any savings rate, you are more than likely to make money. Also, diversifying your assets will help safeguard against the risks. 

The easiest way to do this: start with saving for retirement first and invest in IRA, ROTH, 401K, or 403B. People underestimate a consistent contribution to retirement accounts. It brings in millionaires every day just by merely contributing consistently.

With your Wealth Health Check inside the nav.it money tracking app you can keep your financial wellness front and center
The Legacy Health check helps guide users in protecting their financial legacy.
  1. Estate Planning: As I mentioned in #1, it’s essential to plan if something happens. You want to have a will, and insurance left for loved ones. I’ve had family members die in the last few years, and only two had life insurance policies. It’s a must, especially if you know the people you leave behind will be worse upon your death. It’s essential to look at your options, whether it be a term or whole life insurance. Something is better than nothing! 

The easiest way to do this: Sign up for term life insurance or full life insurance online. It takes a few minutes to do and provide a safety net in case something happens. 

  1. Get Rid of debt: Debt is a hindrance, and there is no way around it. As someone who has paid off credit cards and personal lines of credit before, I would say that having debt holds you back from building your wealth. 

Remember total assets minus total liabilities equals your net-worth. 

If your liabilities exceed your assets, you are actually in the negative net worth. Now what I would recommend is not necessarily dumping all your money into debt. Always create an emergency fund first and then proceed with debt pay-off because life happens, and you don’t want to find yourself in a worse position than before because you didn’t have any money for an emergency. 

The easiest way to do this: Pay consumer debt, credit cards, personal loans, or car notes. Those high-interest rates are more competitive than any investment or savings rate. You are losing money in the long run if you don’t prioritize paying it off because of the rate of inflation. 

  1. Start a business or Side hustle: Creating multiple streams of income is not only critical in building wealth; it’s almost impossible to be able to do it without one. Even if it’s a Youtube page, selling shirts, and flipping houses on the side, it all helps expedite the wealth-building process by having additional income coming in. Not to mention if you have one of your sources of income fail, you have another to fall back on. 

The easiest way to do this is: Find something that you like to do that makes money and do it consistently. Anything worth having is worth working towards. 

For anything you do in life, it takes consistency and dedication. 

Like I’ve always said, I’m big on generational wealth, and I want everyone to participate in that. It will be easier for some people to get to this milestone and much harder for others. However, please don’t give up; keep going because it’s essential to be financially sustainable in a capitalistic society because we’ve all learned in a crisis, the government may only give you a $600 stimulus check and say “Good Luck!”

Related Reads:

Free Downloadable Guide to Managing Debt

Create Your Will Now, Online

Do You Really Need Life Insurance?

Best Finance Books for Growing Wealth


Meet Angelica Imhoede creator of Financial Lioness, a platform dedicated to advocating generational wealth and bringing insight to financial literacy. Having spent the last decade in banking and financial services, Angelica created her platform to bring awareness to the wealth gap in America and the inequalities that come with systemic racism in the financial sector. She spends a lot of her time online creating and publishing digital content related to all topics covered under personal finance.
Recently she published her first E-book, Investing for the Everyday Investor, a step-by-step guide of investing for everyday people to learn the foundation of investing.


Angelica is a native of Minneapolis, Minnesota, where she currently resides with her husband and son. She attended the University of St. Thomas, and received a degree in finance and is currently obtaining her Masters in Data Science. She loves cooking, dancing, and spending time with her family.
You can always catch her online on her IG page at Financial Lioness or her website.

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