Old Money
Encyclopedia
Old money is "the inherited wealth of established upper-class families (i.e. gentry
, patriciate)" or "a person, family, or lineage possessing inherited wealth." The term typically describes a class of the super-rich, who have been able to maintain their wealth across multiple generations.
, Westchester County, New York
, Long Island's Gold Coast
, the Upper East Side
of Manhattan
, Detroit's Grosse Pointe, Boston
's Back Bay and Beacon Hill, Newport, RI, and Philadelphia's Main Line
are associated with old money. Ironically, these areas' inhabitants that are colloquially described as "old money" are almost always descendants of the people the term "nouveau riche" (new money) was originally coined to describe: nineteenth century industrialists, bankers, and builders. Traditionally, wealth was associated with landowning and these Gilded Age fortunes made money in a new way, hence the term new money. Edith Wharton, among Gilded Age America's greatest chroniclers, referred to industrialists and their ilk as "brazen new money".
Wealth
- assets held by an individual or by a household - provides an important dimension of social stratification
because it can pass from generation to generation, ensuring that a family's offspring will remain financially stable. Families with "old money" use accumulated assets or savings to bridge interruptions in income, thus guarding against downward social mobility
.
"Old money" applies to those of the upper class whose wealth separates them from lower social classes. According to anthropologist W. Lloyd Warner
, the upper class in the United States during the 1930s was divided into the upper-upper and the lower-upper classes. The lower-upper were those that did not come from traditionally wealthy families. They earned their money from investments and business
rather than inheritance
. In contrast to the nouveau riche
, the upper-upper class was families viewed as "quasi-aristocratic" and "high-society". These had been rich for generations. They lived off idle inheritances rather than earned wealth.
During the early 20th century, the upper-upper class were seen as more prestigious.
"Old money" contrasts with the nouveau riche
and parvenus. These fall under the category "new money" (those not from traditionally wealthy families). Some families with "old money" include:
Although many "old money" individuals do not rank as high on the list of Forbes Top 400 richest Americans as they once did, their wealth continues to grow. Many families increased their holdings by investment strategies such as the pooling of resources For example, the Rockefeller family's estimated net worth of $1 billion in the 1930s grew to $8.5 billion by 2000. In 60 years, four of the richest families in the United States increased their combined $2–$4 billion in 1937 to $38 billion without holding large shares in emerging industries.
s. Inheritance has been estimated to make up 6% of the US GDP each year. The current generation is wealthier than any generation before. This increase in wealth and inheritance indicates a rise of "old money" in American families. Stephen Haseler argues that America is becoming an inheritance culture in which much economic opportunity is from family inheritance and not personal achievement.
Gentry
Gentry denotes "well-born and well-bred people" of high social class, especially in the past....
, patriciate)" or "a person, family, or lineage possessing inherited wealth." The term typically describes a class of the super-rich, who have been able to maintain their wealth across multiple generations.
United States
American locations such as Fairfield County, ConnecticutFairfield County, Connecticut
Fairfield County is a county located in the southwestern corner of the U.S. state of Connecticut. The county population is 916,829 according to the 2010 Census. There are currently 1,465 people per square mile in the county. It is the most populous county in the State of Connecticut and contains...
, Westchester County, New York
Westchester County, New York
Westchester County is a county located in the U.S. state of New York. Westchester covers an area of and has a population of 949,113 according to the 2010 Census, residing in 45 municipalities...
, Long Island's Gold Coast
North Shore (Long Island)
The North Shore of Long Island is the area along Long Island's northern coast, bordering Long Island Sound. The region has long been the most affluent on Long Island, as well as the most affluent in the New York metropolitan area, which has earned it the nickname "the Gold Coast." Though some...
, the Upper East Side
Upper East Side
The Upper East Side is a neighborhood in the borough of Manhattan in New York City, between Central Park and the East River. The Upper East Side lies within an area bounded by 59th Street to 96th Street, and the East River to Fifth Avenue-Central Park...
of Manhattan
Manhattan
Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...
, Detroit's Grosse Pointe, Boston
Boston
Boston is the capital of and largest city in Massachusetts, and is one of the oldest cities in the United States. The largest city in New England, Boston is regarded as the unofficial "Capital of New England" for its economic and cultural impact on the entire New England region. The city proper had...
's Back Bay and Beacon Hill, Newport, RI, and Philadelphia's Main Line
Pennsylvania Main Line
The Main Line is an unofficial historical and socio-cultural region of suburban Philadelphia, Pennsylvania, comprising a collection of affluent towns built along the old Main Line of the Pennsylvania Railroad which ran northwest from downtown Philadelphia parallel to Lancaster Avenue , a road...
are associated with old money. Ironically, these areas' inhabitants that are colloquially described as "old money" are almost always descendants of the people the term "nouveau riche" (new money) was originally coined to describe: nineteenth century industrialists, bankers, and builders. Traditionally, wealth was associated with landowning and these Gilded Age fortunes made money in a new way, hence the term new money. Edith Wharton, among Gilded Age America's greatest chroniclers, referred to industrialists and their ilk as "brazen new money".
Wealth
Wealth
Wealth is the abundance of valuable resources or material possessions. The word wealth is derived from the old English wela, which is from an Indo-European word stem...
- assets held by an individual or by a household - provides an important dimension of social stratification
Social stratification
In sociology the social stratification is a concept of class, involving the "classification of persons into groups based on shared socio-economic conditions ... a relational set of inequalities with economic, social, political and ideological dimensions."...
because it can pass from generation to generation, ensuring that a family's offspring will remain financially stable. Families with "old money" use accumulated assets or savings to bridge interruptions in income, thus guarding against downward social mobility
Social mobility
Social mobility refers to the movement of people in a population from one social class or economic level to another. It typically refers to vertical mobility -- movement of individuals or groups up from one socio-economic level to another, often by changing jobs or marrying; but can also refer to...
.
"Old money" applies to those of the upper class whose wealth separates them from lower social classes. According to anthropologist W. Lloyd Warner
W. Lloyd Warner
William Lloyd Warner was a pioneering anthropologist noted for applying the techniques of his discipline to contemporary American culture.-Career at Harvard:...
, the upper class in the United States during the 1930s was divided into the upper-upper and the lower-upper classes. The lower-upper were those that did not come from traditionally wealthy families. They earned their money from investments and business
Business
A business is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit...
rather than inheritance
Inheritance
Inheritance is the practice of passing on property, titles, debts, rights and obligations upon the death of an individual. It has long played an important role in human societies...
. In contrast to the nouveau riche
Nouveau riche
The nouveau riche , or new money, comprise those who have acquired considerable wealth within their own generation...
, the upper-upper class was families viewed as "quasi-aristocratic" and "high-society". These had been rich for generations. They lived off idle inheritances rather than earned wealth.
During the early 20th century, the upper-upper class were seen as more prestigious.
"Old money" contrasts with the nouveau riche
Nouveau riche
The nouveau riche , or new money, comprise those who have acquired considerable wealth within their own generation...
and parvenus. These fall under the category "new money" (those not from traditionally wealthy families). Some families with "old money" include:
- The Rockefeller familyRockefeller familyThe Rockefeller family , the Cleveland family of John D. Rockefeller and his brother William Rockefeller , is an American industrial, banking, and political family of German origin that made one of the world's largest private fortunes in the oil business during the late 19th and early 20th...
: While founder John D. RockefellerJohn D. RockefellerJohn Davison Rockefeller was an American oil industrialist, investor, and philanthropist. He was the founder of the Standard Oil Company, which dominated the oil industry and was the first great U.S. business trust. Rockefeller revolutionized the petroleum industry and defined the structure of...
had modest origins and was initially considered "new money", he made billions of dollars in oil in the late 19th and early 20th centuries. Over time, the Rockefellers became considered "old money" as their wealth was passed down from generation to generation and their lineage still remains wealthy.
- The Du Pont familyDu Pont familyThe Du Pont family is an American family descended from Pierre Samuel du Pont de Nemours . The son of a Paris watchmaker and a member of a Burgundian noble family, he and his sons, Victor Marie du Pont and Eleuthère Irénée du Pont, emigrated to the United States in 1800 and used the resources of...
fortune began in 1803, but they became an extraordinarily wealthy family by selling gunpowderGunpowderGunpowder, also known since in the late 19th century as black powder, was the first chemical explosive and the only one known until the mid 1800s. It is a mixture of sulfur, charcoal, and potassium nitrate - with the sulfur and charcoal acting as fuels, while the saltpeter works as an oxidizer...
during the American Civil WarAmerican Civil WarThe American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
. By World War IWorld War IWorld War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
, the DuPont family produced virtually all American gunpowder. In 1968, Ferdinand Lundberg declared the Du Pont fortune to be America's largest family fortune. E. I. du Pont de Nemours and CompanyDuPontE. I. du Pont de Nemours and Company , commonly referred to as DuPont, is an American chemical company that was founded in July 1802 as a gunpowder mill by Eleuthère Irénée du Pont. DuPont was the world's third largest chemical company based on market capitalization and ninth based on revenue in 2009...
ranked 81st on the Fortune 500 list of the largest U.S. corporations.
- The Vanderbilt familyVanderbilt familyThe Vanderbilt family is an American family of Dutch origin prominent during the Gilded Age. It started off with the shipping and railroad empires of Cornelius Vanderbilt, and expanded into various other areas of industry and philanthropy...
made their fortune in the railroad industry and other investments. They have been a prominent wealthy family in the United States for 200 years.
- The Astor familyAstor familyThe Astor family is a Anglo-American business family of German descent notable for their prominence in business, society, and politics.-Founding family members:...
made their fortune in the 19th century, through real estate, the hotel industry and other investments.
Although many "old money" individuals do not rank as high on the list of Forbes Top 400 richest Americans as they once did, their wealth continues to grow. Many families increased their holdings by investment strategies such as the pooling of resources For example, the Rockefeller family's estimated net worth of $1 billion in the 1930s grew to $8.5 billion by 2000. In 60 years, four of the richest families in the United States increased their combined $2–$4 billion in 1937 to $38 billion without holding large shares in emerging industries.
Europe
- The Rothschild familyRothschild familyThe Rothschild family , known as The House of Rothschild, or more simply as the Rothschilds, is a Jewish-German family that established European banking and finance houses starting in the late 18th century...
established finance houses across Europe from the 18th century and was ennobled by the Habsburg Emperor and Queen Victoria. Throughout the 19th century, they controlled the largest fortune in the world, in today's terms many hundreds of billions, if not in trillions ($US). The family has, at least to some extent, maintained its wealth for over two centuries.
Effects of World War II
Economists assert that the largest transfer of income will be as the older generation leaves wealth to the baby boomerBaby boomer
A baby boomer is a person who was born during the demographic Post-World War II baby boom and who grew up during the period between 1946 and 1964. The term "baby boomer" is sometimes used in a cultural context. Therefore, it is impossible to achieve broad consensus of a precise definition, even...
s. Inheritance has been estimated to make up 6% of the US GDP each year. The current generation is wealthier than any generation before. This increase in wealth and inheritance indicates a rise of "old money" in American families. Stephen Haseler argues that America is becoming an inheritance culture in which much economic opportunity is from family inheritance and not personal achievement.
Further reading
- Aldrich, Nelson. Old Money: The Mythology of Wealth in America. New York: Allworth Communications, 1996.