Not all rich people have the same success story. Some inherited their wealth from their family’s successful business ventures. Others were self-made entrepreneurs. If you want to become wealthy, you have to look at how the rich got to where they were. This is why you have to know the differences between old money vs. new money.
There’s a reason why some of the bestselling autobiographies are framed as success stories. We can always learn a lesson from rich people, whether they’re old money or new money rich. What is old money and new money?
The term ‘old money’ means wealth that has been passed down from generation to generation. Old-money families tend to have recognizable names, for example, The Fords.
Unlike old money, new money is money that has been recently acquired. As such, it is much more common than old money. Many billionaires, such as Jeff Bezos, technically have new money because they made their fortune instead of inheriting it.
Those who grew up in generational wealth tend to come from privileged backgrounds. They have access to more opportunities and never had to worry about their needs not being met.
On the other hand, many new money people didn’t have wealth growing up. Some wealthy people with new money grew up in poverty, like Oprah Winfrey. This just makes their success stories all the more inspiring.
There’s a common belief that old money people tend to live comparatively humble lives vs. new money. You don’t usually see people with generational wealth buying Maseratis and other luxuries. They understand that their money isn’t theirs but rather the fruit of their ancestors’ hard work.
Living frugally is an important takeaway that we can learn from the concept of old money vs. new money. There are many things you can live without. Check out my article if you want to know what they are!
Celebrities, pro athletes, and even entrepreneurs tend to spend more money on luxuries. New money people tend to be more wasteful of their money. Just look at how Justin Beiber treated his $240,000 Ferrari!
Most old money families attribute their wealth to successful ventures. You’ll be hard-pressed to find an old-money family that didn’t get their wealth from business.
Looking for your own side-hustle to start a business with? Check out my article on simple hobbies that can help make you money.
Entrepreneurship is no longer the only career path to wealth. Today, there are pro-athletes, celebrities, and even internet stars who earned their fortune!
Most old money families grew their fortunes in the early industrial age. For example, the Vanderbilts got to where they were because of their success in the growing railroad industry.
Because today’s world is so different from centuries before, much new money tends to come from new technologies. For example, Facebook wouldn’t have even been conceived in the industrial era, but its idea changed the world. That being said, older industries, such as railroads, have entirely been phased out by newer technologies, such as domestic flights.
Speaking of new technologies, have you tried using a budgeting app? You should check out my article on the best ones if you haven’t!
Family names such as Ford, Vanderbilt, and Kennedy command respect. They managed to make their wealth span across generations, which is no easy feat.
New money families can eventually become old money families, but they have to establish themselves first. It takes a lot of hard work for one person’s wealth to last for generations.
Old money people tend to look down on how new money people flaunt their wealth. In their eyes, they give rich people a bad name because they’re showing off to other people.
However, in the eyes of people with new money, they have earned the right to flaunt their money and treat themselves well. With new money, people have earned their fortune rather than inherited it, which gives them a sense of pride.
New money and old money are two ways people have become wealthy. Neither is inherently better than the other. It’s important to recognize this and learn what we can from both kinds of wealth.
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Dollars Makes Cents by Shaquana, Financial Coach and Wealth Expert, resources helps professional millennial women of color with the tools and skills they need to eliminate their debt, amplify their savings, and build generational wealth — without having to compromise their lifestyle.
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