HOW TO BE A GOOD RICH PERSON: SLOWLY, AN INHERITOR FINDS HER WAY

“I came to understand that no matter how nice a person I might be, I am still a member of a class of people with white skin who have certain privileges because of their race and who act as a group, and that group has a large impact on society. So I realized that if I really wanted to be a good person, I needed to take responsibility for my group.”

Jennifer Ladd, Labors of Love: The Legacy of Inherited Wealth, Book 2, The Inheritance Project.

Jennifer Ladd is a member of the “1-percent,” although she never signed up for this particular club. It is important to understand that in America the 1-percent stereotype is somewhat misleading. According to a recent New York Timesarticle, “The top 1 percent of earners in a given year receives just under a fifth of the country’s pretax income, about double their share 30 years ago. They pay just over a fourth of all federal taxes. . . In 2007, they accounted for about 30 percent of philanthropic giving. . . . They received 22 percent of their income from capital gains, compared with 2 percent for everybody else.

Still, they are not necessarily the idle rich. [The Times provides an example: a businessman who] likes to say he works “26/9.” Most 1 percenters were born with socioeconomic advantages, which helps explain why the 1 percent is more likely than other Americans to have jobs, according to census data. They work longer hours, being three times more likely than the 99 percent to work more than 50 hours a week, and are more likely to be self-employed. New York Times, “Among the wealthiest 1 % many variations,” New York Times, January 14, 2012”

An unknown portion of the 1 percent have not made their money themselves: they are what are variously called “heirs,” “inheritors, “heiresses,” and a long list of derogatory terms, like “filthy rich.” Jenny is an inheritor I met at a conference. I asked her if I could interview her for a book I was working on, and when I arrived at her home in western Massachusetts, I thought I had the wrong address: the house, small and modest, sat on a small lot in a middle-class neighborhood. But there was Jenny at the front door!

The most important aspects of Jenny’s story are too long for one blog-post. This post is the first of two. The whole story is included in my book Labors of Love: The Legacy of Inherited Wealth: Book 2. Jenny’s combined inherited and earned income of just over $1 million puts her squarely in the low-to-middle group of 1-percenters. More important, Jenny gives away about half of her income.

Jenny comes from “old money.” Her great-grandparents on both sides were very rich. Her maternal great-grandfather was William Sargent Ladd, who made a lot of money in real estate, resources, and banking. Charles Pratt, her maternal great-grandfather, was a partner of Standard Oil with John D. Rockefeller.

Jenny remembers visits to both grandparent households: She described the Pratt household as cold, stiff, and reserved – not a place where active children were welcome. The Ladd grandparents were friendlier and lived a less upper-class, less formal lifestyle.  Jenny remembers her Pratt grandmother as philanthropic: when Jenny was old enough to discuss philanthropic giving with her grandmother, she found her to be a helpful mentor.

As the family culture evolved from the original Big-Oil, real-estate, and banking money, life became less formal and more “normal”—easier for the the children just to be kids. Jenny was free to explore the woods near her house and invite her friends to come and play at her home. She went to a progressive private school where she learned practical skills, like carpentry, as well as academic subjects. Jenny came of age in Cambridge, Massachusetts during the Civil Rights Movement and the Vietnam war, and she was active in both. Her activism continued in college (Antioch) and afterward: labor organizing, anti-war demonstrations, and so on. At age twenty-one she learned that she had inherited $650,000. Although by today’s standards this is not an overwhelming amount, it was overwhelming to Jenny. Her parents introduced her to her trust officer:

“Because he was a traditional, not-easy-to-talk-to trust officer, we never had a frank introduction about my money. I felt uncomfortable about having so much money. Here I was—a wealthy person who’d never had a “real” job, and I was surrounded by [activist] organizers were trying to do something about inequality. So it was a painful time for me. I had no idea who I was or how I should be in the world. Should I just go along with the group? I believed in what we were doing, but I wasn’t sure where my own voice was, or if I even deserved to take up space. I thought that if I wasn’t doing something that was obviously good for the world, I wasn’t a legitimate being—especially since I had money. I’ve had to work hard to overcome that feeling of not being legitimate. I’ve had to learn to make all of my work my own, as opposed to thinking of what I do as my paying-off-debt work.”

… To be continued.