During the gilded period from the end of 19 to the beginning of the 20th century, the Vanderbilt family, which started from the shipping and railway industries, was a famous American family that originated in the Netherlands. In 2007, Forbes published the list of "the richest 15 people in American history", and cornelius vanderbilt, the family founder, ranked third, only after john rockefeller and Andrew Carnegie.
Kony Liers is a famous shipping, railway and financial giant, and also the prototype of the popular computer game railroad tycoon. When he died in 1877, he left a fortune of 105 billion US dollars, accounting for 1/87 of the US GDP at that time. The GDP of the United States in 20 12 years is 15.6 trillion dollars. If converted according to this ratio, Kony Liers's legacy is equivalent to180 billion US dollars in 20 12, while Bill Gates, who has been the richest man in the world with 1995, is there. However, at the Vanderbilt family gathering of 1973 120 people, none of the family members were millionaires, and I am afraid that few families can catch up with this speed of wealth distribution, which also confirms the old saying of China that "three generations are not rich". How on earth did such a huge amount of wealth dissipate in such a short time? What lessons can China rich people who pay more and more attention to family fortune's inheritance learn from it?
The first generation: the legendary wealth creation process of Kony Lears
1794, Cornelius Vanderbilt, the future railroad tycoon, was born in Staten Island, new york. His father is an uneducated, quiet but diligent person, and his mother, Phoebe Hand, grew up in a well-off environment and received a good education. In the process of growing up, Kony Liers was greatly influenced by his mother. Even if he succeeded later, he often asked her for advice. At the age of 1 1, Kony Liers left school and began to work for his father's sailing yacht on the dock of new york Harbor. His early sailing life made him stronger and stronger, and his sailing skills became higher and higher. He soon became an excellent sailor.
18 10, when Kony Liers was only 16 years old, he borrowed 100 from his mother to start a business. In order to test whether he is hot-headed or really enterprising, his mother put forward a harsh loan condition, that is, before Kony Liers 16' s birthday, an 8-acre virgin land was reclaimed and crops were planted. In order to borrow this $ 100, Kony Liers spent four weeks before her birthday, reclaiming land and planting crops, and successfully completed the tasks assigned by her mother before her birthday. From then on, he started the business of transporting passengers and goods between Staten Island and Manhattan. At the end of the first shipping season, he not only paid off his mother's loan, but also gave her an extra $65,438+0,000, which was the beginning of Kony Liers's successful career. During the Second American War of Independence, which started from 18 12, Kony Liers helped the army transport fortress materials, which was a career achieved by climbing a flight of stairs.
18 17 Kony Liers, who is only 23 years old, already owns several Sail barges with a total value of over $7,000, and has accumulated $9,000 in cash. Although not rich, he is also a very rich person among his peers. Under the background of the vigorous development of sail barge transportation, he made a surprising and very important decision in his life: to sell his sail barge and choose to work for others and become the captain of "Mouse", a very small steamboat. This job gives Kony Liers a chance to learn more about the emerging steamboat industry and lay a good foundation for his own steamboat career.
1828, Kony Liers established a steamboat transportation company in new york. He was smart and enterprising in business, and launched a fierce price war with his competitors at all costs, which made him quickly become the leading force in this industry. After more than ten years of painstaking efforts, Kony Liers has hundreds of ships and has become a huge fleet. 1849, the discovery of gold mines in California set off a gold rush in western Europe and America. Before the transcontinental railway, Kony Liers opened up a new steamboat route to transport gold prospectors from new york to San Francisco. This service brings him more than $6,543,800+every year.
Since 1864, the steamboat shipping business is still very profitable on the whole, but Kony Liers, who is nearly 70 years old, has once again made an important decision in his life: to give up his favorite steamboat business and shift his career focus from shipping to railways. Because he has realized that the rapid expansion of the railway system will gradually replace shipping as the core of the American transportation industry. Kony Liers once again used his shrewdness to win a great victory in the Wall Street market, which not only made huge profits, but also included Harlem Railway, Hudson Railway and New York Central Railway. The three railways jointly supported Kony Liers's title of "railroad tycoon". In the future, Kony Liers will gradually bring more than a dozen railways such as Michigan Central Railway, Lakeside Railway and Southern Canadian Railway under his control.
The second generation: the first wealth inheritance, William pushed family fortune to the peak.
1877 After the news of Kony Liers's death spread, flags flew at half mast in many schools, government departments, stations and clubs. According to his will made two years before his death, his son william henry vanderbilt was the first heir, inheriting about $95 million. His young wife, Frankie, received $500,000 in cash and a house in Washington, D.C. 10 Street. His eight daughters each received $500,000, some of which was obtained through railway bonds and the other through the establishment of a trust fund. Railroad tycoon's brothers, sisters, nephews and nieces, and various loyal employees and friends also received a certain legacy. The most surprising thing is that his second son, Cornelius Liers Vanderbilt, was ill since childhood, but only got a trust fund with a total amount of $200,000, and the interest generated from the trust fund supported his daily living expenses.
In the same year, Cornelius Liers expanded the beneficiary of the estate through the annex to his will, and gave William's eldest son, cornelius vanderbilt II, a railway share worth $5 million. Two million dollars each to William's other three sons, William Kissam Vanderbilt, Frederick william vanderbilt and George Washington Vanderbilt II. Because the inheritance to four grandchildren is passed on through a trust fund, there is no need to pay inheritance tax on this money. Kony Liers left most of his legacy to his eldest son William for the simple reason that he wanted to keep the integrity of his huge wealth and leave it to the world forever as a monument (with photos).
After Kony Liers died, the story about him didn't end there. Because his second son Jeremiah got very little inheritance, the Vanderbilt family started a long inheritance lawsuit. After his father died, Jeremiah encouraged his sister to file a lawsuit against his father's wishes. The will was made against the true wishes of the parties when his father was unconscious and in poor health. This lawsuit started at 1877+ 1 1. This is one of the longest and fiercest lawsuits in the history of American courts. William appears in boring court almost every day.
In order to prove that Kony Liers is mentally ill and incapacitated, the prosecution's lawyers exposed a large number of scandals that caused great uproar among the people of the whole country, such as Kony Liers's bad living habits, syphilis, contact with psychics and so on. To confirm what the lawyer said, the medical experts dissected and described the organ operation of Kony Liers after his death in front of the court audience. Bribery, bribery, perjury and other incidents continue to appear in this lawsuit. Finally, in March 1879 and 19, Judge Kevin read many expert opinions and announced that he supported all the clauses in the will.
However, William's brothers and sisters did not stop there. They filed many lawsuits against the will. So in April of 1879, William, who was tired of complicated lawsuits, decided to settle with his brothers and sisters and terminated all the lawsuits. Although the details of the settlement have not been announced, it is widely believed that William gave his brothers and sisters $ 1 10,000 each and helped them pay $250,000 and other legal debts arising from legal proceedings. Later, it turned out that William chose to set up a trust fund for his younger brother Jeremiah's $6,543,800+,and listed Mr. Worcester, the chief secretary of the family railway company, as the trustee, responsible for the operation and distribution of the trust fund. At this point, this inheritance struggle lawsuit, which was full of bribery and perjury from beginning to end, was settled under William's compromise.
William has a straight aquiline nose like his father, but his father looks down on this son because he thinks the child is too weak-willed and has no ambition in business. 1839, my father arranged for William to be a clerk in a company. The salary as a shop assistant is very small, and the money William earns is not enough for his living expenses. 184 1 year, William married the priest's daughter Maria despite his father's strong opposition. Kony Liers did not allow others to question his authority. He first asked William to resign as a clerk, and then ironically bought a farm in Staton Island as a wedding gift for his son and Maria, saying that he would not give money to support them in the future, which made the Williams have to rely on the farm to make a living. It was not until 1863 that Kony Liers's favorite youngest son, George Washington Vanderbilt, died of lung disease in the civil war that William was taken seriously by his father. This may also be Kony Liers's helpless choice, because his favorite youngest son died of illness, and the second son idled around all day after leaving home, so he had to choose William, who was plain-looking and lacked pioneering spirit, to inherit his career.
In order to exercise William's business management ability, Kony Liers let him join the board of directors of Staten Island Railway Company. Before the development of Staten Island Railway, there was a bottleneck. Under the management of William, the company's railway and train dispatching runs orderly and begins to enter a new development stage. This success made Kony Liers feel very gratified. Soon, William was appointed as a member of the board of directors of Harlem Railway Company and Hudson River Railway Company, and served as the president of Harlem Railway Company. William showed his talent once again. He creatively merged the two railway companies for unified management, adjusted the train operation schedule, and made the trains of the two railways complement each other, which on the one hand reduced the operating costs and on the other hand maximized the overall profits of the two companies. 1869, William extended the central railway line to Chicago and St. Louis, and then bought shares in Lakeside Railway in the capital market.
After the death of Kony Liers 1877, William inherited most of the family property, completely controlled the business operation of the whole family, and gave full play to his management ability. In that year, in order to reduce costs, the railway department cut the wages of railway workers by 10%, which triggered a general strike. Some workers claimed to blow up the New York Central Railway, and all walks of life in the United States were in a state of extreme panic. William did not learn from the way his father asked the army to suppress the strike in Pennsylvania, but chose to negotiate with employees calmly and make appropriate compromises, because he believed that violence could not solve practical problems, and only by sitting down and negotiating could the company develop in the long run. He paid a total of $6,543,800 to the striking employees, and promised that the railway company would resume a 654.38+ 00% pay cut after improvement. His practice has achieved the expected results. Among the 654.38+02000 strikers, 654.38+065.438+0500 returned to their jobs, and the company's losses were minimized.
It is William's cautious, hands-on and tireless work spirit that makes Vanderbilt family fortune accumulate more and more. When 1885 died, his property reached1940,000 US dollars, almost twice the property left by his father, and family fortune reached its peak at this time.
After the third generation: in the gilded age, the American family declined rapidly in a short time.
Despite his huge wealth, William thinks that his happiness is not proportional to wealth. Before he died, he said, "A fortune of $200 million is a great pressure for anyone, so great that it can kill anyone, because you will not be happy." On the one hand, he didn't want his father's hard-earned property to be completely divided up, and on the other hand, he didn't want any of his sons to bear the pressure of huge wealth, so he gave most of his property to his eldest son Vanderbilt II and his third son Kisa. Vanderbilt II and Kisa received $70 million and $55 million respectively, and the remaining property was divided equally between the other six children and his wife.
William's initial idea was simple, that is, he hoped his children could live happily and not be overwhelmed by huge wealth. However, due to the division of wealth, the family lacks leaders and core personnel in wealth management, which has also become the beginning of the family's gradual decline.
Vanderbilt family began to build super-luxury houses while accumulating wealth rapidly, especially in the third and fourth generations of this family. Thorstein veblen, the originator of American institutional economics, put forward the word "conspicuous consumption" for the first time in his book "On the Leisure Class-A Study of Institutional Economics" to describe the luxurious life in the gilded age in the United States. The third and fourth generations of Vanderbilt family were the most exposed figures in the news of "conspicuous consumption". According to some data, the Vanderbilt family built more than a dozen luxury buildings between 5 1 and 59th Street in Manhattan, among which 1 building on 57th Street had 137 rooms, which was the largest building in American cities at that time. In addition, the Vanderbilt family has built more than a dozen luxury holiday villas, including marble house, circuit breaker house and Biltmore house (table 1).
Mable Villa was built by the third generation Kisa from 1888, and 1892 was given to his wife Alva as a birthday present. The construction cost of this 50-room luxury villa is as high as 1 1 ten thousand dollars, and the cost of marble alone is 7 million dollars. After its completion, its design and grandeur were unparalleled in American houses at that time, and its front porch is often compared with the operation of the White House until now.
Tingtao Manor was built by Kisa's brother Vanderbilt II from 1893 to 1895. It has its own advantages and disadvantages with Mabel Villa, but it is much bigger than the marble villa, with 70 rooms and a living area of 65,000 square feet.
The scale of Mabel Villa and Tingtao Manor was already very large at that time. However, compared with the Bilmo Manor, which was built by George Washington Vanderbilt II in 1888 and lasted for six years, it is a little pale in comparison. The model structure of Bilmo Manor was designed by famous French architects, with 250 rooms (five times that of Mabel Villa), 43 bathrooms, 65 fireplaces, 3 kitchens, 1 bowling alley and 1 indoor swimming pool, covering an area of 178926 square feet (2.75 times that of Tingtao Manor). Today, the Renaissance-style Bilmore Manor is still the largest private villa in American history and the most famous of all the buildings left over from the gilded age (Table 2).
Vanderbilt's luxurious life is not only manifested in building luxury houses, but also in holding extremely luxurious dances from time to time. A newspaper in new york once wrote: "Last night, the Vanderbilts held a masquerade ball in a luxurious villa, which is undoubtedly the most brilliant and picturesque entertainment in the history of new york." Kisa's wife Alva once said that the cost of each dance definitely exceeds 250,000 US dollars, and the value of roses prepared for the dance alone exceeds 65,438 US dollars +0 1 0,000 US dollars.
Most of the descendants of Vanderbilt family live in comfortable and luxurious environment. They don't know how to accumulate wealth. Many people are born with endless wealth. The luxurious lifestyle of future generations is also a major reason for the decline of the family. The fourth generation of Reginald Claypool Vanderbilt is a typical example. Lazy and alcoholic, he spent millions of dollars inherited from his family on women, wine, food, cars and other luxury toys. He is also a real gambler. Reginald's personal image has become another epitome of the decline of the Vanderbilt family.
Only 48 years after Kony Liers's death, one of his direct descendants died penniless, and all the luxury villas built by his family survived 80 years after his death, either being demolished, forcibly sold or turned into museums. The Vanderbilt family declined after the continuation of 130, and the reason may not be clear in a word or two. But in addition to the increasing inheritance tax, property tax and the Great Depression, the extravagant and enterprising lifestyle of several generations of the family is the fundamental reason for its decline.
Experiences and lessons inherited by Vanderbilt family fortune
First, cultivate suitable family successors.
Vanderbilt's family tradition lasted only one generation. In order to train his eldest son William, Kony Liers asked him to start from the bottom and be a clerk. Although his son married Maria because he didn't listen to his advice, he hurried to work on the farm. However, after the family situation changed, Kony Liers immediately adjusted his deployment and gradually arranged William to the board of directors of the railway company to exercise his management ability. Thanks to the careful training of Kony Liers, William was able to double family fortune in less than nine years. William is obviously inferior to his father in the cultivation of heirs. Cornelius vanderbilt II, the new heir, is hard-working, but obviously can't compare with his predecessor in the management and earning power of the company. Judging from the wealth distribution scheme designed by William for future generations, he also prefers to let children enjoy life rather than work hard. Since William, no parents in the whole family have been trying to train excellent children. After the family style is ruined, even hundreds of millions of wealth is not enough to squander.
Second, maintain the integrity of the family fortune.
At this point, cornelius vanderbilt made an arrangement earlier, and he handed over 95% of his property to his successor William. William, on the other hand, wanted his son to live happily and not be overwhelmed by huge wealth, so he divided his huge wealth, and when the third generation passed on to the fourth generation, he also divided the property, resulting in less wealth left to future generations. The dispersion of wealth is not conducive to the emergence of new family leaders.
Third, the choice of inheritance mode.
Family inheritance is accomplished by means of trust, cash, stocks, real estate, etc. Among them, only trust is tax-free, and the latter three methods are easy to realize except for a large tax burden, and are not binding on future generations, so future generations will be easily squandered if they lack self-discipline. At the same time, the family has never used a professional team to manage the property. If a family foundation is established and managed by a professional and credible person, the result may be completely different.
In the era of great change, almost all the first generation American families have accumulated wealth in the form of getting rich, but the key point is that the descendants who have not received management training should not inherit wealth by running a company and a luxurious lifestyle when the family gets rich, otherwise only regret will be left in the end.