The Vanderbilt family gained prominence through shipping and
railroad empires and eventually various other areas of industry and
philanthropy.
Cornelius Vanderbilt died in 1877 with legendary wealth, which
his son quickly doubled, becoming the richest man on earth —
yet, within a generation, the vast majority of the family's
fortune was lost.
This isn't unusual: studies have shown that about 70 per
cent of wealthy families lose that wealth by the second generation,
and 90 per cent by the third.
Why is this? A lot of it comes down to the fact that, when
making plans for passing on wealth, it's difficult to foresee
future changes — a child moves to a high-tax jurisdiction; an
heir develops problems, marries a spendthrift or has a bad divorce,
or simply proves not to be adept financially; tax laws change;
stock markets crash; new inventions transform the world; pandemics
and wars happen; heirs are targeted by criminals, fall under bad
influence or become unwell;
