Page 33 - Waterfall City Issue 4 April 2025

overspending, and, in extreme cases,
complete financial ruin. For instance,
a recent baseline survey by the FSCA
has shown that only 51% of South
African adults are financially literate.
Without guidance and education,
heirs risk making decisions that
diminish their inheritance.

Furthermore, it is often assumed
that wealthy families openly discuss
financial matters with their children,
but studies suggest otherwise. A
reluctance to discuss finances can
leave heirs unprepared to manage
their wealth effectively, making them
vulnerable to making poor financial
choices.

Additionally, the modern economy
presents new challenges. Inflation,
economic downturns, and
geopolitical instability could erode
wealth if it is not carefully protected
and invested. As wealth becomes
increasingly tied to financial markets,
a thorough and well-thought-out
financial plan should be implemented
to avoid client fortunes diminishing
faster than anticipated.

The solution: Long-term
planning and financial
education ensure their inheritances last. but only if it is managed effectively.
There is a well-known saying by True generational wealth is not just
Warren Buffet that aptly illustrates From a macroeconomic perspective, about passing down assets; it’s about
why long-term wealth planning the ongoing wealth transfer could passing down the knowledge and
is essential: “Someone’s sitting in drive significant economic growth – discipline needed to sustain them.
the shade today because someone
planted a tree a long time ago”. We
repeatedly see that generational
wealth is not self-sustaining; it
requires active management,
strategic planning, and patience.

For younger generations, growing
up in a digital world provides an
opportunity to enhance financial
literacy and investment strategies
through online platforms, digital
financial tools, and educational
courses on personal finance. By
leveraging technology, Gen Z
and millennial heirs can better
understand wealth management and

Waterfall City Issue 4 2025 31