Old Money’s 7 Essential Ways to Stay Rich
It’s one thing to get rich, another to stay rich. And it’s something else entirely to safeguard family money for more than five centuries. Founded in 1521 by Jakob Fugger—aka Jakob the Rich—Germany’s Fugger Foundation has endured plague, famine, two world wars, the Internet, and the euro. Today, the organization’s eight charities still dole out alms and maintain churches, while innumerable entities—rival families, countries, entire empires—have fallen. Reached while recovering from a horse-riding accident at Schloss Oberkirchberg, a castle purchased by Jakob, the Countess Maria Elisabeth Thun-Fugger, 66, the foundation’s chair and de facto spokeswoman, shares a few lessons about longevity.
1. Start with unimaginable wealth
Jakob endowed the foundation with a stake in his business. How rich was he? The Richest Man Who Ever Lived, a new biography by Greg Steinmetz, describes a lender and entrepreneur who strong-armed sovereigns, popes, and other lesser men, amassing a fortune then worth 2 percent of Europe’s gross domestic product.
2. Don’t sweat liquidity
“The most brilliant thing we ever did,” Thun-Fugger says, “was to convert our assets from cash to property.” That looked especially smart during the hyperinflation of the Weimar Republic, when $1 could buy about 4 trillion reichsmarks. Thanks to its landholdings, the foundation thrived.
3. Lobby God
The foundation’s crown jewel is the Fuggerei, a planned community for the needy in downtown Augsburg. It still has more than 150 residents. Original tenants were required to pay 1 gulden per year—about a week’s pay—and pray for the Fugger benefactors. The cost has since dropped to €1 ($1.12), but the prayer requirement, the countess confirms, “has not changed.”
4. Keep the family honest
All three branches of the clan have board representation. “If one person has a crazy idea, then the other two can correct it,” Thun-Fugger says.
5. Keep chipper during wars
The Fuggerei burned down in the 1600s, during the Thirty Years’ War; three centuries later, Allied bombers leveled half the homes. Both times, the foundation started over. “The second world war was not yet over,” Thun-Fugger says, and family elders “were in their bunker and decided to rebuild. They said, ‘The whole country is in ruins, but nevertheless, we’re still going to go for it.’ ”
6. Resist hostile takeovers
A modern dynasty might have to deal with Carl Icahn. The Fuggers have fended off Napoleon and Hitler. When each dictator controlled Germany, he wanted to absorb the family’s property into the state coffers. Says Thun-Fugger: “I guess we were lucky to make it through all of that.”
7. Ignore fads
“I asked our archivist if there was ever a big scandal, and he said no,” Thun-Fugger says, “though sometimes they did whatever was fashionable. For example, at one point, everyone with our type of property had a brewery.” The Fuggers, who once brokered the sale of indulgences from the Vatican, turned out to be poor beer vendors. “They had to shut it down,” the countess says. “But there was never a situation where there’s been mismanagement and we’ve lost half of our assets.”