Old Money Vs New Money: What’s The Difference?
Old money vs. new money is a debate that has been around for as long we know. Over centuries, self-made millionaires vs. the aristocracy have dominated books, movies, and plays. However, how do these terms compare? Let’s take a look! There is something about both concepts that can boost imagination.
What Is “Old” Money?
The term “old money” has slightly different meanings in different parts, but it generally refers to inherited wealth. That is wealth that has been around for several generations, passing between them as time goes on.
In the U.K, when people talk about old money, they refer to aristocracy members. For hundreds of years, the aristocracy has been part of the landed gentry (upper-class owners).
On the other hand, in the U.S, the term refers to rich families that have been around for several generations. However, they are not aristocrats. Their ancestors had successful businesses.
In any case, when someone talks about “old money”, they refer to wealth that was not self-made.
What Is “New” Money?
New money refers to people that became rich recently and didn’t inherit any wealth. In most cases, “new” money people who did not start wealthy had to work hard. This means putting in a lot of effort, skill, and sacrifice to make money.
These people also started creating their wealth in a new way, not as traditional landowners. Their innovation and capacity to strive and find new opportunities are impeccable.
Ironically, “old” money families in the U.S today are descendants of people described as “new” rich. This is the example of Bill Gates and his family. Microsoft’s owner is considered as “new” money. If their great-grandchildren are rich because of him, they will be considered “old” money.
Famous POVS About Old Vs. New Money
Socio-anthropologist William Lloyd Warner said in the 1930s that there were two types of American upper-classes.
The Upper-Upper Class – they had been rich for several generations. People even viewed them almost as aristocrats. In other terms, “old” money.
The Lower-Upper Class – they did not come from traditional wealthy families. They built up their money from businesses and investments rather than inheritance. In other words, “new” money.
According to this famous sociologist, the Upper-Upper Class had once more prestige than the Lower-Upper Class. However, this is not the case today. This is because society has started to appreciate self-made millionaires over inherited millionaires.
Examples Of New Money
Jeff Bezos was born in 1964 in New Mexico into a humble family. His father abandoned him, and he lived his entire childhood on a farm. He started working at McDonald’s at 16, and despite being under pressure, he never gave up. Jeff graduated with honors as an electronic engineer and computer scientist years later.
At 30 years of age, Bezos decided to create Amazon. The rest is history. Right now, Jeff Bezos is considered by Forbes as the second wealthiest person on the planet with a net worth of over $202,000,000,000. An excellent story of personal improvement.
He earns millions of dollars a day, and when he was barely 10 years old, he followed all the market quotes. His name is Warren Buffet, and he is currently ranked 10th in the ranking of the richest people on the planet.
Warren Buffet is another millionaire who was born into a humble family. He lived his entire childhood in Nebraska during the crisis period of the 30. In that time, his father lost his job as a stockbroker in addition to all his savings. This caused Warren to increase his hunger for success and carefully invest his money.
Buffet is considered the best investor in history. His long journey and his vast experience allow him to claim that title. The billionaire also will donate 99% of his fortune when he dies – another incredible example of a successful person who started from the bottom.
Elon musk is the perfect example of what an innovative mind can do when it has technology tools. The economist, businessman, and physics graduate owns Space X, Tesla, and many other companies.
Elon was born and raised in South Africa in 1971. He had a passion for technology and business since he was little. He learned to program at 10 and sold his first program at 12 for $500. When he turned 18, he went to study in Canada and then tried luck in the U.S.
After creating Paypal and owning other disruptive companies, his success went skyrocketing. He is now one of the most famous people globally and also reached the number 1 position in terms of wealth. He managed to surpass Jeff Bezos this year, achieving a net worth of over $297,000,000,000.
Examples Of Old Money
The Rockefeller family is one of the richest and most well-known dynasties. They have held positions in politics, influenced environmental protection, and owned the most expensive real estate globally.
Today, their net worth would be estimated at $318,000,000,000. How did they amass and hold on to so much money? Well, it all comes from one entrepreneur, John Davidson Rockefeller. In 1870, he co-founded the longest oil refiner in the world, The Standard Oil Company.
Their ability to maintain their wealth is the result of the Rockefeller Trust. This is where most of the family’s money has been kept since 1934. A trust committee oversees the use of this money, and family members receive portions of the generated interest.
Du Pont Family
The Du Pont family founded one of the largest chemical companies in the world. Its products have been used in every U.S war since 1812.
By 1818 the family business was losing ground. The company was swamped in debt until Henry Du Pont took control. Direction changed, and dynamite was the new product.
In the early 1900s, after the death of Henry Du Pont, the business lacked direction again. However, Alfred Du Pont and his 2 cousins Thomas and Pierre, saved the company.
In 1950, Du Pont’s company helped the U.S government make hydrogen bombs. The family helped focus the effort of scientists, all while being handsomely compensated by the U.S government.
Dupont’s family net worth is nowhere near Rockefeller. However, according to Forbes, it is estimated to be at $16,000,000,000. This fact makes Du Pont one of the most powerful and rich families in the U.S.
Rising from a lowly apprentice working at a small Hamburg bank, Mayer Rothschild displayed a keen interest and talent for finances from an early age. In little time, Mayer had made himself a prominent member of the global banking industry.
Overseeing operations from London to Berlin, the Rothschild’s helped stabilize international currencies. They achieved this through their lending and banking practices with individual governments. The family also financed many wars and lent England money for defeating Napoleon Bonaparte.
Such an incredible amount of international power helped consolidate Rothschild’s family’s vast net worth. This is valued at $400,000,000,000. The largest amount of money that a family made in all human history.
Differences Between “Old” And “New” Money
New money invests short term, while old money invests long term. One of the fundamental differences here has to do with the overview of the world. New money is all about now and living the moment. On the other hand, old money is about forever.
This happens because it is a lot easier to earn money now. Fast returns are expected with the digital era, and new generations are getting more impatient.
New money is playing the high-risk, high-return game. On the other hand, old money doesn’t care about rapid returns. Everything is focused on making sure the wealth grows sustainably throughout generations.
If we were to bring it into today, new money is buying crypto. Old money is holding onto more gold.
New money is spent on trends. Old money is spent by tradition. Old money is pretty much set in stone when it comes to their spending habits. They have the legacy brands, their already favorite hotels, resorts, car brands, and stick with them for life.
New money is bold and wild, and it wants attention. They love trends, and they are part of the conversation about what is changing. These people always try to get the last brand car, the nicest and modern house. Old money rather seeks tradition and classic things.
New money loves talking about money; old money rarely mentions it. This happens because, for the new rich, money is exciting. They are amazed at how much you can do with money because they have never had it before.
For old wealth, money is almost taboo. They teach them young. Here are 3 golden rules about old money:
- Don’t tell anyone because they will treat you differently.
- Don’t show that you have wealth.
- Don’t spend it on unnecessary things.
The juxtaposition of being proud of being wealthy and ashamed of having so much money you didn’t earn is almost amusing. This has shaped the way old wealth positions itself in society. They want to play it safe – no intentions of standing out.
New money, on the other hand, can’t scream it loudly enough. They buy the pink Ferrari and the oversized mansions. They are shaped by the culture in which they grew up.
New money sits courtside; old money plays golf at the country club. Because of new money being shaped by the current generation, they find everything antiquated. New money didn’t grow up playing polo or riding horses. They watched Jordan score 69 points against the Cleveland Cavaliers. For them, that’s history, and they want to be part of the making.
For old money, mainstream sports are too democratic. A bit too accessible for everyone. Tennis, Polo, or Golf at the country club have entry barriers. Not everyone can get in, and this is what they enjoy. It’s like classism between the upper classes.
Attitude Towards Life
New money lives in the age of speed. They have to-do lists and calendars. These people go through them as quickly as possible to write down another achievement. They also don’t miss the social media post about conquering the day.
Old money kicks back. They volunteer, do charity work, travel, host parties, and shake their heads in disbelief at the new generation. They are not in a hurry to get anywhere because they have already arrived.
You may know the phrase: “Money talks, wealth whispers”. We can assure you this is 100% true. Truly wealthy people are very protective of their privacy. Old money spends money to remain anonymous and keep a low profile.
Old money cares about not bringing shame to the family name above everything else. This is why paying for keeping their image clean has become a priority.
New money does the opposite thing. They flaunt their wealth everywhere on Instagram and every tabloid in town. If you didn’t know, they even pay for being in the front of Forbes magazine! This is because they are extremely careful about what other people think.
New money is open to new people, and old money is closed off. Despite having money, new money is more relatable to the average person. They are living the dream we all have. To make it big despite our current circumstances.
This is why they connect differently with people. They are not snobbish or shy away from normal things.
Old money is scared that anyone new coming in could mess with the existing order of things.
This comes to the point where they almost get paranoid. This is why wealthy mothers still insist their sons or daughters marry into another wealthy family.
New money simply no longer cares about the theatricals of society. They don’t dress for status. This is why billionaires like Zuckerberg, Gates, or Musk wear comfortable clothes instead of business suits. Old money loves rules because they keep out the undesirables.
New money has specialized knowledge. This is because to get rich nowadays, and you need specialized knowledge. The new rich have an almost absolute understanding of a particular space or industry with very little knowledge outside of their interests.
Old money has an abundance of general knowledge at the opposite pole because they’ve mastered the art of conversation. It’s one of those things they get taught when young: “One should be able to hold their end of the conversation with anyone on any subject”.
New money embraces change, but old money hates it. For old money, change means letting go of the comfortable, familiar, and diving into the unknown. However, that’s exactly where new money thrives.
Not only do they embrace change, but they are also the ones bringing it. Old hotel chains were the old money to set an example in real life. Airbnb is the new money bringing the future into the present.
New money entertains by dining out. Old money entertains at home. This is one of the basic differences in behavior. Unless they go out to that favorite restaurant where they order the same dish every time, it is unlikely to catch old money hosting outside their house.
On the other hand, new money is running through every new restaurant available. If you celebrate new money, you can also bet some bottles will be popped. If you ever went to Vegas, you may know that champagne showers are a real thing.
Conclusion on New Money vs. Old Money
Well, so we have reached the end of this old money versus new money battle. After we’ve done this article we asked ourselves, would you like your grandchildren to be old money or do you believe every generation should get their own? That’s a tough question to answer, and you should leave a comment with your thoughts below.
However, if you decide to make the best decision regarding investments and to make money online, it’s a great idea to visit our investing section. You might eventually fall under the umbrella of “new money”!
We hope you enjoyed the article! We have plenty of articles there. Those are meant for people who want to imitate the new money rich (cryptocurrency investing) or follow the old money path (ETFs and Funds). No matter which way you take, we are sure you will make it big if you read our advice.
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