Family Governance

Wealth is hard to create, and it is even harder to maintain. “Shirtsleeves to shirtsleeves” or “rags to rags in three generations” are popular phrases to describe the challenges and realities associated with wealth transfer across generations. The reality is that it isn’t even the third generation that is the challenge. Over 70 percent of wealth is lost in the second generation.

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Family governance is about engaging the next generation, equipping them to understand and act on your values and intentions for stewarding what has been accumulated and helping them manage their wealth for generations to come.

  • What are the principles that guide your family’s life/choices/decisions?
  • What values are you instilling and passing on to your family?
  • What lessons have you learned in life that you want to pass to future generations?
  • What are some of your favorite quotes, bible verses, proverbs, or other pieces of wisdom?
  • What are the things you want to intentionally teach your children and grandchildren?
  • What advice would you give to a young person growing up today?
  • How do you want your wealth to affect your family members and the causes you support?
  • Are there any other important ideas or messages?

Why It’s Important

People are living longer, adding many years between the building of a family’s wealth and its passing to the next generation. In fact, it is estimated that $41 trillion will be transferred over the next few decades. Children may in fact be parents, and even grandparents, before they inherit, giving families plenty of time to discuss with children and grandchildren how family wealth should be handled. To add to the complexity marriage and divorce rates should be considered. An estimated 42-45% of first marriages end in divorce, creating family structures with greater complexity. It’s not unusual for parents to have children from different marriages and sons- and daughters-in-law joining and leaving the family picture.

Your legacy includes much more than assets and possessions. Thinking about your legacy gives you the opportunity to intentionally decide how you will leave your mark on your loved ones and the world. A Legacy Will goes beyond the traditional Last Will & Testament to include all of the important things you want to instill and pass down to future generations.

What are you doing to engage your heirs in carrying forward the legacy you’ve so carefully planned? If the answer is nothing, consider our Family Summit Meeting as a valuable strategy for creating engaging and meaningful multi-generational planning.

It’s never too early (or late) to begin the conversation. Let’s talk.

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