Parents Must Prepare Children to Manage Wealth to Avoid Loss, Expert Warns

A Senior Advocate of Nigeria, Osaro Eghobamieh, has warned that parents risk losing their hard-earned wealth if they do not prepare their children to manage it. Speaking at the Arise Women Conference in Lagos, he highlighted the issue of generational wealth in Nigeria, noting that many family businesses fail or create disputes after the founders pass away.

Eghobamieh urged parents, especially those who own businesses, to involve their children in their operations and financial decisions from an early age. He emphasized that wealth transfer is more than just writing a will; it requires careful preparation of the next generation.

He identified five key areas necessary for successful wealth transfer: spiritual, intellectual, social, human, and financial capital. For spiritual capital, he stressed the importance of instilling values like integrity and discipline in children. He shared a personal story about how his father made him and his siblings stay in a meeting to learn about business relationships.

On intellectual capital, he noted that education alone is not enough. Parents should expose their children to business operations and decision-making processes. He recounted managing his mother’s business for four years and how that experience helped him in his career.

Eghobamieh also pointed out the importance of social capital, advising parents to introduce their children to their business contacts early on. He explained that children need to build relationships that will support them when they take over the family business.

He highlighted the need for human capital, which includes the values and structures within families that help children work together. He cautioned against relying solely on prayers for their success, suggesting that parents should establish systems that prepare their children for responsibility.

Lastly, he discussed financial capital, urging parents to document their assets and create plans for managing family businesses. Eghobamieh lamented that Nigeria lacks a strong culture of generational wealth, stating that wealth often dies with the older generation.