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However, about 70% of wealthy families lose their status by the second generation.
In aposton her Instagram,Cruze offered four suggestions.
Get Out of Debt
Firstly, Cruze said getting out of debt is essential.
Each involves making a list of your debts and paying them off one by one over time.
The avalanche method starts with the loan that has the highest interest rate instead.
Both options can make sense depending on the nature of your debt and broader financial situation.
Doing so will keep you on track for a bright financial future.
But how should youinvest, and what should you invest in?
Government bonds, on the other hand, keep a small percentage of your capital protected from market risks.
But why should you?
The main reason is that paying off your home eliminates most housing costs from your budget.
Paying off your home early can also reduce your stress and help you feel more comfortable financially.
But its not always the right decision from apurely financial perspective.
For example, you might have locked in a low mortgage rate under 3%.
This is a common idea meant to help children developgood financial instincts.
Its especially important when youre thinking about generational wealth.
Remember, about 70% of wealthy families lose their status by the second generation.
You may be able to avoid that fate by helping your kids understand financial discipline while theyre still young.
Can Rachel Cruzes Strategy Really Build Generational Wealth?
Cruzes tips are great pieces of advice that have been echoed by many other financial experts across the country.
However, they likely wont help you create generational wealth in the way most people understand it.
Getting out of debt and paying off your home early can create more room in your budget for investments.
you might increase your income by advancing in your career and working side hustles.
But if you want to improve your investment returns, you may have to assume an increased risk.
That can look like investing in a single company you believe in instead of an index fund.
Single stocks tend to fluctuate much more from year to year, which can lead to large losses.
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