8 Ways To Build Generational Wealth Like the Rich Without That Kind of Money
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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Generational wealth often gets portrayed as something for only the ultra-rich, people with massive incomes, trust funds or seven-figure investment portfolios. But financial experts say that idea is not only misleading, it stops regular families from building real, lasting wealth of their own.
In reality, wealth that transfers to the next generation is built the same way for everyone: through consistent habits, simple systems and decisions that allow compounding to work over time. Here are eight ways to build generational wealth even if you’re not rich.
1. Stop Thinking Generational Wealth Requires Being Rich
The biggest misconception about generational wealth is that it starts with a big pile of money. It doesn’t, according to Drew Lunt, founder and advisor at Scratch Capital. “It starts with the ability to survive long enough for compounding to work.” Families looking to pass on wealth just need habits that keep them saving and investing for as long as possible.
2. Pay Yourself First — Even in Small Amounts
“Generational wealth is a lot more accessible than people think,” added Taylor Kovar, a CFP and the founder of 11 Financial.
You don’t need huge deposits. What matters is making saving mandatory rather than optional, according to James C. Knapp, CPFA and managing partner of Knapp Family Wealth. “Before any discretionary spending, my wealthy clients make it a priority to contribute to savings and investments,” he said. “They treat saving as a non-negotiable monthly ‘expense.'”
Even small amounts add up when you stick with them. “Consistency matters more than the size of any one deposit,” Kovar said. Or as Lunt put it, “A Roth IRA contribution of $100 a month won’t change your life this year, but it will absolutely change your kids’ lives decades from now.”
3. Use the Accounts With the Biggest Leverage
Average earners can build powerful long-term wealth simply by using tax-advantaged accounts the way wealthy people do. Lunt recommended using “the accounts with the most leverage,” such as a 401(k) with an employer match, a Roth IRA, an HSA or automatic retirement contributions that supercharge small dollars.
“A 401(k) with an employer match is the obvious choice … any tax deferred vehicle is preferred to a taxable account,” added Robert R. Johnson, a certified financial analyst and professor of finance in the Heider College of Business at Creighton University.
4. Build Wealth the Boring Way
The wealthy stay wealthy not by chasing hot tips but through diversification, index funds and automation that let the market work for them. “The most effective strategy is also the most boring: Save a little, invest consistently, and let time do the heavy lifting,” Lunt said.
Ordinary investors can follow the same blueprint with low-cost index funds, fractional shares and dollar-cost averaging. Investing in diversified equity index funds “is the most effective and simple strategy to build generational wealth,” Johnson said.
5. Attack High-Interest Debt
Just as investments compound forward, debt compounds backward. High-interest credit cards and personal loans eat into future wealth, reduce cash flow and keep families one setback away from losing progress.
“High-interest debt drains future opportunity, so paying it down is one of the highest-return investments an ordinary person can make,” Lunt said. Of all the high-interest debts, credit cards should be given priority, Johnson emphasized. These balances “work against you the fastest,” Kovar added.
6. Automate Everything
The wealthy rely on structure, not willpower. Automation removes emotion and inconsistency, two of the biggest barriers to long-term wealth building. Setting up automatic transfers, recurring investments and regular plan reviews keep your progress going.
“Consistency beats intensity. Lasting wealth is built by people who don’t need to be perfect, just persistent,” Lunt said. And automation makes that persistence easier.
“Habits matter,” Kovar said. “People who build long-term wealth tend to automate savings.”
7. Protect What You Build
One crisis can erase years of progress. Wealthy families stay protected through emergency funds, insurance and clear estate planning. These simple tools prevent assets from being lost or disrupted during illness, job loss or death.
“An emergency savings fund … is meant to cover life’s unexpected black swans,” Johnson said. Umbrella liability coverage and well-structured estate plans “ensure a smoother wealth transfer,” Knapp added. Wealthy families also know the importance of “clear beneficiary designations, a straightforward will, and the right amount of life insurance,” Lunt said.
8. The One Move That Most Boosts Generational Wealth
Experts agreed that the best step someone can take is simply to start saving and stay consistent. Even tiny automatic contributions, a debt-reduction plan or a single index fund can shift a family’s financial trajectory for generations.
“If there’s one move someone can make this year, it’s this: Create a plan that prioritizes staying in the game,” Lunt urged.
Generational wealth is built by letting time and compounding do the heavy lifting for you and the generations who come after you.
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