I read an interesting article with this title recently, and wanted to share it on my blog today. As focused as our society is on money – making money, saving money (both short-term and retirement), and even spending money – discussing how we actually invest our own money is still a sort of taboo subject.
Marvin H. McIntyre wrote, “Money is the last taboo. People will talk about their sex lives before they discuss their finances.” Interesting but true, right? Arecent survey from Wells Fargo WFC found that nearly half of Americans say the most challenging topic to discuss with others is personal finances (44%). It begs the question — if no one is talking about it, how do we know what beliefs and behaviors divide those who get rich and manage to stay rich from those who do not?
Though you may not be comfortable discussing your investment strategies with your neighbors, you definitely should be discussing it with your family. Talking though, is only part of the equation.It turns out that families who have built and maintained intergenerational wealth have a shared vision. Whatever that vision is, be it capitalistic, philanthropic, philosophical, or an ethical mission, thriving family dynasties like the Rockefellers and DuPonts understand, no matter how detailed their portfolios, financial plans, or estate plans, none of these are substitutions for a Heritage Plan.
Heritage Planning is the process of sharing one’s values, morals, beliefs, traditions, wisdom and experiences with future generations. When a family defines who they are and expresses what they stand for, hope for, believe, and do, Heritage Planning acts as the stalwart which influences how assets are used, allocated and preserved in the future. Let’s talk about why Heritage Planning is essential.
- Without strong, consistent leadership, families fail. Just like in corporations, great leaders are made, not born, and a key part of building leaders in your family is true collaboration between parents, advisors, and heirs. Older family members might opt to share their intrinsic wealth: i.e., the benefit of their own life-lessons, work ethic, family stories, personal values, and philanthropic and volunteer experiences.
- Heirs learn by doing—not by reading a bunch of legal papers. Heritage Planning is a hands-on, face to face endeavor. For it to be effective, senior family members must mentor the children through real world experiences under the guidance of other family members and advisors.It’s recommended that families get together in person at least once a year, and cover not only family business topics, but fun and personal topics and events to encourage the widest range of participation.
- Recognizing an individual’s talents and interests helps determine their purpose within the family. Every family member has value above and beyond their net worth, including their talents, accomplishments and even community involvement. Also, keep in mind that each generation may have different priorities, values, and competencies, which is important to recognize and acknowledge.Recognizing an individual’s purpose within the family builds and reinforces unity, and the leadership roles in the family are quite often separate from business or money roles.When professional competencies, personal desires, and talents of family members are taken into account and multi-generational participation is openly encouraged, you are on the right track and you are actively preparing children for their future roles and responsibilities.
In summary, Heritage Planning is the roadmap for expanding a family’s wealth beyond it assets. It establishes a broader context in which to build family traditions, preserve unity, and hand down a legacy while maintaining and growing accumulated wealth. I think that’s worth talking about!
If you’re interested in reading the full article, click here.
