Financial Planning & Wealth Management For Future Generations

When we work with wealthy families we like to take a multi-generational approach. We know that when there is significant wealth or a family business, the goal of parents is often to see this passed on for the benefit of future generations.

A key question that arises is how best to equip future generations to be able to manage significant wealth responsibly.

Financial Education

We believe that financial education is important and involving future generations should start relatively early on. Of course, there needs to be a consideration as to when this process might start and much will depend on the characteristics of the next generation.

Involving Future Generations

There are a number of benefits for the family in involving future generations early on:

It enables the older generations to pass on their values and wishes for how they want their wealth managed in the future.
It provides sufficient time for future generations to learn about wealth management concepts such as risk, asset allocation and taxation. It may be the case that they get hands-on experience by managing a small portfolio of their own. This seems a better approach than suddenly inheriting significant wealth and being ill-prepared to manage it.
Where there is a family business, future generations that express an interest can start to be involved in the business and can learn different aspects of how the business operates. Again, this is preferential to suddenly being thrust into a management position on the death of a parent.
It can provide a sense of continuity for family wealth. Too often we see the older generation become more and more risk averse and start to hold significant amounts in cash in later life when it may be beneficial to stay invested for the benefit of future generations.
Decisions can be made to benefit family members whilst the older generation are still alive. Too often there is an assumption that future generations will have to wait until the death of parents or grandparents in order to benefit from family wealth. However, what a wonderful thing to see your grandchildren receive the best education or to help them on to the property ladder.
It is much easier to design an estate planning strategy when future generations are involved and it avoids any surprises when they ultimately inherit their parent’s wealth.
Discussions around Lasting Powers of Attorney and long term care can be done when the older generation are in good health which can ensure that their children are fully aware of their wishes in these areas.

Our role is to help our clients and their families and often we do this at difficult times following the death of a parent or grandparent. In my experience, having a trusted adviser on hand can be so helpful, not only to assist the surviving spouse but to help future generations manage the family wealth.

Waiting until the death of a parent or grandparent to involve future generations is often a recipe for disaster and can result in wider family tensions as each family member has a different view on how the family wealth should be managed.

Starting the process early, getting family members involved is the key to a successfully transitioning wealth to the next generation.

Contact Us

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