Legacy Series Part One: Establishing Family Values
By Brannon J. Fisher, CFP®
In this three-part series, we are highlighting what we view as the three tenets of maintaining family wealth: values, stewardship, and structure.
Many businesses create value statements that contain their core values and beliefs. These are vital documents and are referred to when businesses make critical decisions.
Most affluent and high-net-worth families could benefit from doing the same thing. However, many have never given this much thought. Family leaders are often so focused on building wealth or running a business that they neglect this critical aspect of legacy planning.
Also, it’s human nature to not want to confront our own mortality, which this exercise forces one to do. This is the same reason why many families and individuals don’t create a last will and testament or perform basic estate planning tasks that would greatly simplify matters for their heirs after they pass.
Origins of Family Values
Family values can originate from many different sources. For example, the patriarch may have come from a modest background and built a successful business from the ground up through hard work, persistence and ambition — and these are the values he holds dear. Religion and spirituality can also form the foundation of family values such as generosity, charity and helping those who are less fortunate.
And many patriarchs of wealthy families simply want to ensure that heirs don’t feel a sense of entitlement and are able to see beyond themselves to the needs of others in their community and around the world. Warren Buffett put it well when he said, “I want to give my kids enough so they could feel they could do anything, but not so much that they could do nothing.”
Make It a Priority
Regardless of where they originated, the most important thing is to identify and define family values so they can be passed along to heirs and future generations. This usually requires prioritization, planning and effort on the part of family patriarchs who must make it a priority.
Often, the best way to get started is to plan a retreat with all the family members and stakeholders who should have a say. This should ideally occur somewhere away from your normal home or office environment so distractions are minimized and everyone can focus on the task at hand, such as at a hotel or resort.
It might be helpful to invite someone outside your family to serve as a facilitator, such as a wealth advisor, family office consultant or professional counselor. This person can help ensure that the conversation and planning stay on track and everyone’s voice is heard and respected. Keep in mind that it could take more than one session to complete this task.
Your goal should be to emerge from this session or sessions with a formal values statement that commits your family values to writing. This way, everyone can see for themselves not only what your most critical family values are, but also understand why these particular values are so important.
This is especially important when it comes to passing these values on to future generations. It’s one thing to verbalize family values to your heirs, but it’s another thing to create a formal written document that can be handed down to them.
“Shirtsleeves to Shirtsleeves”
Stories abound of wealthy families who failed to establish a legacy and pass their values down to heirs and future generations. This is one of the reasons behind the saying, “Shirtsleeves to shirtsleeves in three generations.”
The best way to avoid this scenario is to create a formal family values statement and share this with your heirs. A Simon Quick advisor can help you begin the process of establishing and passing on your family values. To learn more, contact me at bfisher@simonquickadvisors.com.
About Brannon Fisher, CFP®
Brannon joined Simon Quick in April of 2019 and helped extend the firm’s reach into the Rocky Mountain region by establishing an office in Denver. He is responsible for new business development and works closely with the New Jersey-based Client Advisory teams to provide ongoing services to our valued clients. Brannon holds degrees from Colgate University, CU-Boulder, and Dominican University of California. He remains involved with higher education by volunteering for Greenhouse Scholars as a mentor, career advisor and selection committee member. Brannon, his wife Mandy, and his daughters Waverly and Layla enjoy a variety of active outdoor pursuits and host a revolving cast of foster pets for Mandy’s nonprofit animal rescue, Old Dogs New Digs. To learn more about Brannon, connect with him on LinkedIn.
DISCLAIMER
Simon Quick Advisors, LLC (Simon Quick) is an SEC registered investment adviser with a principal place of business in Morristown, NJ. Simon Quick may only transact business in states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. A copy of our written disclosure brochure discussing our advisory services and fees is available upon request. References to Simon Quick as being "registered" does not imply a certain level of education or expertise. No information provided shall constitute, or be construed as, an offer to sell or a solicitation of an offer to acquire any security, investment product or service, nor shall any such security, product or service be offered or sold in any jurisdiction where such an offer or solicitation is prohibited by law or registration. Additionally, no information provided in this report is intended to constitute legal, tax, accounting, securities, or investment advice nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. It should not be assumed that future performance of any specific investment or investment strategy will be profitable, equal any corresponding indicated performance level(s), be suitable for your portfolio or individual situation, or prove successful.