Too Much Money? These Gen X-ers Give It Away
When Karen Pittelman found out her grandfather, a successful real-estate developer, had created a $3 million trust fund for her, she didn't want to keep the money. At 24, she was frustrated with the world's inequalities and wanted to do what she could to lessen them. She persuaded skeptical parents to let her dissolve the trust and create the Chahara Foundation, dedicated to poor women in Boston. "There's such a joy in taking action for our beliefs," says Pittelman, now 31. "I was committed to being part of social change."
With generation X-ers set to inherit the wealth of baby boomers over the next several decades, more people will soon find themselves in Pittelman's situation. According to the Government Accountability Office, the wealthiest 10 percent of baby boomers hold an average of about $3.2 million in assets, much of which they intend to bequeath. Researchers at Boston College estimate the total intergenerational transfer of wealth could be $41 trillion through 2052. Organizationsusually led by young philanthropists themselvesare springing up to help these young inheritors put their newfound wealth toward projects aligned with their values.
As Pittelman experienced, wealth can be isolating and confusing without resources to help one figure out what to do with it. She says that because they are uncomfortable with their wealth, affluent young peopleherself includedtend to hide it by ordering the least expensive things on the menu, wearing cheap-looking clothes, and making fun of other rich kids. "I didn't want anybody to know," she says.
Last year, Pittelman, as a consultant for Resource Generation, wrote Classified: How to Stop Hiding Your Privilege and Use It for Social Change and coauthored Creating Change Through Family Philanthropy: The Next Generation to help other wealthy young people put their privilege to good use. Learning to stop being ashamed of wealth, she says, helps people "shift from being paralyzed to being able to take action."
Being "out." Resource Generation, a New York-based organization for young people with wealth, has already helped some privileged young adults make that transition. Before Michalya Schonwald, 28, attended a Resource Generation conference in 2004, she didn't know what to say when someone asked her how she afforded her apartment. Now, if someone asks, she explains that she has a trust fund and, if possible, takes the opportunity to talk about philanthropy. Schonwald, a leadership training consultant in Jerusalem, says, "As a result of being 'out' about being of privilege, I've enabled other people in my life to also start funding."
Andrew Pearson, 29, a Resource Generation member who inherited a quarter-million dollars from his grandmother, ignored the money at first. "I didn't know what I was supposed to do with it," he says. Then he met with other Resource Generation members over dinners near his home in Durham, N.C. He learned to talk about wealth and issues such as whether it makes more sense to donate time or money to an organization. "It's hard to have that kind of conversation with someone who can't relate to it," he says. Now he trains other donors at Resource Generation workshops.