Legacy Planning for Families and Family Offices

Nov 15, 2022 7:44:50 AM

Death, taxes, and money. You can count on these topics to elevate your blood pressure and anxiety if you haven't planned for them. However, avoidance is not an option.

Early planning and good communication with your family and trusted advisors can make your wishes known and alleviate some of the unknowns of inheritance, taxes, and estate planning.  

Over the next 30 years, it is estimated that more than $30 trillion will be passed from one generation to the next, making it the most significant intergenerational wealth transfer in American history.   

Are you prepared?  

Preparing future generations

Find a Trusted Advisor   

Knowing whom to trust is just as important as having an updated trust. Look for a manager that will focus on personalization, protection, and preparedness for volatility. Preservation of what you have earned will ensure there will be something left for your heirs.   

Your manager should know what type of investor you are, your life stage, and the risk categories with which you are comfortable. If you are still determining if your current advisor is the right fit, check out our post, 10 Questions to Ask Before Hiring a New Investment Advisor.  

Have the Inheritance Conversation   

If you have yet to have this often-uncomfortable conversation with your children, grandchildren, or trusted friends, don't wait. It's not an easy topic and is often overlooked due to poor planning, communication, or misguided expectations. So lay it all out there.   

Make your intentions clear and ask the hard questions. Often you will find a sense of relief from opening doors previously off-limits due to privacy concerns or lack of understanding. It will also build trust between generations. But, on the other hand, you might also discover that no one wants that sideboard filled with your grandmother's good china.   

Open dialogue offers a pathway to clarity, eliminating potential misunderstandings after you are no longer around to answer questions. 

Your legacy 

Include the Next Generations in Your Planning   

The future of your wealth will most likely be in the hands of a Gen X or Millennial when you leave this earth. But how prepared will they be to fulfill your wishes?   

Start having official family meetings and invite them to meet your management team or advisor. Include them in conversations about your investments and allow them the time to explain what is important to them.   

Often this includes environmental, social, and governance investing. ESG investing is a growing designation and often carries ethical concerns important to your heirs. Be sure that your advisors include your family in decision-making, as well as keep a focus on educational support. Having an organized plan for succession can benefit all, including your advisor.  

Learn more about Vineyard Global Advisors' Long-Term Investment Strategies 

Consulting an advisor

For Advisors  

 All too often, as wealth passes generations, those dollars often leave the original clients' firms. To remain relevant to the younger generations of investors, advisors should be sure to:  

  • Build relationships with the families of your investors. Include them as mentioned above, and host family meetings to ensure that crucial inheritance issues are discussed and implicitly understood.  
  • Address critical issues related to transitions into retirement and managing taxes from inheritance. Have options available and educational information at hand for each generation.  
  • Pay attention to technology and offer services that don't require a phone call or a trip to the office. Also, stay current on ESG and impact investments, as most younger generations place ethical investments at the top of their lists.  
  • Consider adding younger team members to your advisory team. This not only helps to develop emerging talent but serves as an opportunity to improve the stability of the overall client relationship.  

Have a strategy to help build better relationships, not just with your clients but with their families. Studies have shown that focusing on family meetings, regular communication, educational support, and organized succession planning is essential to keeping clients happy for generations.  

Consider this: You hire a house-sitter to stay in your home while on vacation. You wouldn't just walk out the door without leaving detailed instructions on walking the dog, feeding the fish, watering the plants, and grabbing the mail. It would be inefficient and ineffective, and it would waste your money and their time.   

Eventually, we will all be walking out the door of our lives, whether we want to or not. Integrate planning now. It will require open discussions with your family members and investment management team.   

It will also help you define your goals - how you want to enjoy what you have earned and how you want it to benefit your family members and community. Planning will ensure you can provide for future generations and protect your legacy.  

Vineyard Global Advisors offers a range of investment strategies designed to allow participation in the market's growth within a dynamic, risk-managed framework that seeks to offer protection during significant market declines. Our goal is to give our clients greater peace of mind by generating steadier returns over time. Contact us to learn more.  

Finding a new investment advisor can be a successful experience when you've made the proper preparations. Learn more about Vineyard Global Advisors' long-term investment strategies.

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