Affluenza: Prevention & Treatment
By Greer Gibson Bacon, CFP®
In the coming years, baby boomers will transfer about $30 trillion to their children and grandchildren. But, most will be lost within three generations. And, the primary culprit will be affluenza.
Affluenza is a condition that may affect a child raised in a well-to-do household who develops a distorted sense of self-worth. For example, he may fail to appreciate the value of money and the hard work it takes to earn it. He may feel entitled. By contrast, she may feel anxiety or guilt because she didn’t earn it. She may have low self-esteem. Either way, affluenza is a real problem. It may lead to mental health issues (like substance abuse) and impair a child’s pursuit of his personal potential.
"A very rich person should leave his kids enough to do anything but not enough to do nothing."
Fortunately, there is a way to protect children from affluenza. It requires teaching them about responsibility and money from an early age. Children need to learn how to earn money, and save and spend it wisely. Also, they need to learn about their family’s values. Along those lines, here are a few key thoughts.
- Money doesn’t grow on trees. Even preschoolers can do simple chores to earn money. And, as children grow so should their chores. Summer jobs are important for high school and college children. Although there may be some conflict with family travel plans and enrichment activities, the lessons learned are priceless. Summer jobs teach accountability and instill a genuine sense of accomplishment and ownership.
- Good things come to those who wait. Whether it’s a new toy, summer camp or college, children need to learn to save for the things they want. They need to learn how to set realistic goals in terms of time and money, and work toward them. From time-to-time, parents may need to set-up a “matching” plan but never a “bail-out” plan. Saving teaches children self-control and delayed gratification. Importantly, it teaches a greater appreciation for things that are earned.
- Spend wisely. Teach children to tell the difference between things they want and things they need. For example, your child may want a new iPod but he needs to put gas in his car. Also, teach them to buy smart. It’s good to know how to compare branded and generic products, and understanding the cost advantage of buying in bulk (1 pen or a package of 3). Spending wisely involves making choices and accepting their consequences. It takes practice (and a few mistakes) to make good choices consistently and reap the rewards.
- It’s better to give than receive. Teach children to volunteer for a charity in our community. Understanding how the less fortunate live will help them develop compassion and appreciate their own circumstance. As they begin to earn, teach them to give of their money, as well as their time and talent. As John Kennedy put it, “to those whom much is given, much is expected.”
Affluenza can be successfully treated in all but the most extreme cases. But, it requires a determined effort to teach these key lessons.
This article first appeared in the March/April 2018 Spokane County Medical Society Magazine. The information referenced in the article is current as of date of publication.