A trust fund is established by wealthy parents or guardians for their child’s future use. The term is often associated with negative connotations, such as laziness and entitlement, but many trust fund kids work hard and contribute positively to society. Critics fear that trust funds hinder a child’s work ethic and financial literacy, but some parents actively teach their children the value of money and work. The stereotype of trust fund kids being constantly happy is also debunked, as many struggle with their purpose and relationships.
A child in a trust fund is someone born to someone with a large amount of money, who sets aside considerable resources in a trust fund for the child to access and use later. The phrase, often used with modern socialites, became popular in the 20th century as more American families became wealthy and had children who inherited money. The connotations of the term are often quite negative, but many individuals who inherit their money don’t fit the general stereotype and work very hard for themselves and for others.
Start
Parents or legal guardians who have significant wealth usually establish a trust early on for a child using inherited or earned money, property, or other assets. They can often manage the trust themselves if they want to, but it’s common for someone else to handle it. Usually, in America, the child does not gain control of the trust until age 18, when a person is considered a legal adult in most states. Sometimes, it won’t have access until the parent dies. Until then he often lives at home, or his guardian or parents help him pay for a place to live.
Public perception
People tend to describe the trust fund kids as spoiled and lazy. They also typically see them as out of touch with what most people experience or go through, or as not understanding what helpers do to make them feel better. Another common perception is that they lack the skills to manage a job or be independent.
Many people look down on these well-heeled kids, thinking that they often spend what they have on tropical estates, lavish accommodations, countless vehicles, or long nights on the town. Buying friends or spending time in the spotlight is a routine accusation. At the same time, in some cases, the name associated with the trust fund child carries with it a level of fame and opportunity for success, as well as a degree of respect, awe, resentment, and envy.
Given how the public typically views these children, many people, especially those in urban communities, use the term in a negative way or as an insult. If a person sees someone else who isn’t working but still has some good stuff, for example, he might say something like, “He’s like a trust fund kid, getting whatever he wants.” Another example would be someone saying, “Nah, I’m not a trust fund kid, I actually have to work for my money.”
concerns
While the goal of most guardians or general parents is to provide a good life for their children, critics often fear that, having everything provided for them, the children in the trust fund will not develop a good work ethic. A related concern is that because parents or different trustees usually manage assets, children don’t become financially literate on their own or truly acknowledge what they have. They say possessions make children too self-centered, which can cause them to become rude or inconsiderate to others, even seeing those from the lower classes as inferior people.
Debunk the stereotype
Although some trust fund kids fit the general stereotype, using their money just for fun, travel and being worldly, some use it to pursue serious goals like starting their own businesses. Others try to go to school, often an Ivy League college or university, and develop a career of their choosing. Many study law or business, as these subjects are directly related to earning, investing and protecting assets. Even investing money in a cause like animal rights or feeding the hungry are ways they use their wealth to contribute positively to society.
The idea that these people are always happy because of their wealth is another myth. Many find their wealth alienating, because others may perceive them as shallow simply because of the possessions they have. Trust fund kids can become depressed if they believe their relationships aren’t very deep, and some even take steps to hide their financial status so it doesn’t cloud what other people think and how they interact. They may also question their ultimate purpose, struggling to find their talents or place in the world.
Parental role
Much of the stereotyping with these individuals stems from the idea that parents or guardians don’t make an effort to teach them valuable life lessons. This concept does not always apply. In fact, as of 2013, a whopping 75% of millionaires didn’t grow up wealthy, instead working their way towards everything they’ve got. Realizing the value of both money and work, many of these wealthy people make a conscious effort to keep their children from being spoiled. Some, for example, require their children to get a job, go to school or otherwise contribute before they can get any of the trust assets. It’s becoming more common for those with money to leave less inheritance for their children, giving much of it to charities or scholarship groups so the kids don’t feel too comfortable.
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