I’m currently slogging my way through Anthony Bianco’s 700-plus page book on the Reichmann family titled Family, Faith, and Fortune, The Empire of Olympia and York. There’s no affiliate link there because while the book is hella interesting, I certainly could have done without the 200 pages detailing every detail about the family’s Jewish heritage. We get it, you’re through, and they’re Jewish. Holy hell, are they Jewish.
Essentially, the story of Olympia and York goes something like this. Jewish family displaced by World War 2 comes to Canada and starts to get involved in real estate. Within a few decades they’re the largest property developers in North America, building some of the most iconic office spaces in the world — including First Canadian Place in Toronto and Canary Wharf in London.
The Reichmann family was incredibly close-knit. Three of the five brothers lived within a five minute drive of their parents in Toronto. Most every night the Toronto side of the family would end up in Samuel Reichmann’s basement discussing religion or the latest real estate deal. And, naturally, many members of the family ended up working for the company.
The Reichmanns were wealthy before even stepping foot in Toronto, mostly thanks to Samuel’s successes in Hungary in the 1930s and Morocco in the 1940s. But there’s little doubt that the family’s ability to work together helped elevate the clan from a run of the mill success story to mega superstars.
And then it all came crashing down. But that’s another story for another day.
There’s an important lesson to learn from the Reichmann story. Your family could be an incredible resource that isn’t being exploited to the fullest. Here’s how you can use your kin to get ahead, and not just using by child labor, either.
Lessons from Asia
I was vaguely aware of this before spending a year in South Korea, but the concept still hit me like a ton of bricks. It makes so much sense.
Essentially, Asian family dynamics work like this. Instead of each generation splitting up and doing their own thing, the family pools their resources and everyone lives together in somewhat happy harmony. Grandma and grandpa take care of the kids while mom and dad go to work. Sometimes all of the middle generation live together, other times it’s just the eldest son’s family.
Compare this to my family. I have three grandparents still alive, who all live in some sort of assisted living facility. My parents are right around retirement age, but both still work. I live close by while my sister lives a couple of hours away. Between the nine adults — including my wife and brother-in-law — and my sister’s three kids, we maintain five separate residences. The older folks rent while the younger generations have nearly a million dollars invested in real estate.
If we pooled our resources and all lived together under one roof we could concievably have five incomes contributing to the household expenses. My mom could watch my sister’s kids and make sure grandpa didn’t break a hip. And the pensions earned by the eldest generation could be contributing towards household expenses rather than rent at the old folks home.
Say the five working adults pulled in an average of $40k each annually, while the three older folks each chipped in 20k from their pensions. That would generate a total family income of $260k. You’d have big expenses, obviously, since you’d need a place large enough for a dozen people. But the fact is it becomes cheaper to feed and clothe people if there’s more of them under one roof.
Practical ways you can do this
I’m the first to admit the last thing I want is grandma filling her Depends in my basement. That’s pretty much my definition of hell, actually.
But there are still plenty of ways to leverage your family to become richer.
I borrow money from my parents all the time. It’s a win-win scenario. They get better than GIC returns on their capital while I get a relatively cheap loan. You should consider doing the same thing, but only if your folks can afford it. 100% of anyone’s portfolio shouldn’t consist of loans to your lazy ass.
Another way is to join the family business. You’ll ensure the operation lives on for at least another generation, all while helping to keep the compounding machine rolling. Parents are usually pretty generous to their spawn in that kind of situation, too.
And so on. There are a million ways you improve your situation by leveraging your family. So what are you waiting for?
Oh, and one more thing. If you’re a single guy living with your parents, tell any prospective ladies that you don’t live with them. They live with you.