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In South Africa, intergenerational wealth is an extremely complex and for many people, emotional issue, influenced by our country’s history, legacy and our current economic challenges. 

A recent study by 1Life revealed that approximately 77% of South Africans do not have any generational wealth of any kind, with 61% saying they have little to no idea how to go about creating it. 

Further complicating the matter is the fact that SA’s current unemployment rate is a staggering 44%, making intergenerational wealth creation extremely challenging when many South Africans are already struggling to make ends meet. 

Fortunately, financial advisers are uniquely positioned to assist clients in better understanding the value and importance of creating intergenerational wealth that they can pass onto their families.

Understanding intergenerational wealth and its importance 

Because many South Africans do not have a clear understanding of this concept, they mistakenly believe that intergenerational wealth is simply cash stored in the bank or a property that is inherited. 

In reality, intergenerational wealth can consist of cash, property, shares and investments, life insurance or funeral cover policies, a business and family heirlooms that may carry considerable value such as precious jewellery and art. 

Educating on the expansiveness of what counts as intergenerational wealth is the first step in helping them to understand why creating generational wealth is beneficial for their family’s future – and that it’s not as out of their reach as they might think. 

But we need to take it further and help our clients see the numerous benefits intergenerational wealth can bring to their families. 

Building generational wealth can also spark thoughts about their children’s spending and saving habits, and motivating important household conversations about wealth building and managing money wisely from a young age.  

The challenge of building intergenerational wealth in South Africa

Unfortunately, the reality is that creating intergenerational wealth in South Africa is particularly challenging (but far from impossible, as many people tend to think). Slow economic growth, coupled with a volatile currency, inflation, rising unemployment and the effects of 2020 means that South Africans are saving less and spending more to get by.

Our nation’s complicated political and economic history also impacts wealth creation and saving abilities. For many older South Africans, wealth building was not an option growing up. On top of this, many younger South Africans are responsible for providing for other family members, making the act of saving even more challenging. 

Africa wealth

However, the outlook is far from doom and gloom. Increasingly, younger millennial and Gen Z employees are entering the South African workforce and have displayed a significant appetite for learning about investments and saving. 

As advisers, we can work to assist especially these younger investors in creating achievable generational wealth and setting wealth planning goals early in life.

How to encourage your clients to start building intergenerational wealth 

1. Educate your clients on the reality of building generational wealth

As discussed earlier, taking the first step towards creating generational wealth can be as simple as understanding that generational wealth isn’t limited to one thing or a certain degree of wealth. 

We can help our clients to realise that the sooner they start, the more wealth they can create and that success is not a big step taken in the future, it’s a series of small steps taken now.

How saving can impact building generational wealth

2. Discuss and help your client create wealth saving goals they would like to achieve for their children

Clients may want to build intergenerational wealth for their children and families but have no clear direction or goals about the kind of wealth they want to create. 

Having a preliminary discussion with your client and helping them to create goals and targets they want to achieve can motivate them to begin taking serious action to begin working towards these goals.  

3. Encourage reassessment of current monthly budgets

Many clients may not even realise how much they could be saving each month and putting towards their wealth building goals by simply making a few changes to their monthly budgets. 

Encourage your clients to take a look at their existing monthly budgets or, if they don’t have one, to create a detailed budget to assess where their money goes each month, and where they could be saving more. 

4. Be empathetic and understanding of their circumstances

Not everyone is going to come from the same background or set of circumstances, and we need to be aware and sensitive to this. Before making any suggestions or creating goals, be sure to ask your client important background questions like their current financial status and previous experience with financial planning and saving. 


Remember to always be empathetic and understanding, especially if a client expresses frustration over their personal or financial situation. Be encouraging but not dismissive of their unique circumstances.