We recently read an excellent piece that compares navigating generational wealth transition to flying a jetliner. One wing of the jet is the technical planning, and the other is family culture. The authors of the piece point out that “In many families that flounder, the ‘planning wing’ has received disproportionate attention – trusts are established, advisors are in place, tax strategies are adopted and investment approaches are calibrated.” As you can imagine, a jet can’t fly unless both wings are fully functional (and well matched!). So why do so many families attempt to fly the jetliner with mismatched wings? The authors of the piece point out three underlying reasons for inattention to the “Culture” wing:
- Fear. Concern about confronting challenging family dynamics or historical behaviors can leave culture unaddressed. Family members may believe that discussing challenging issues could worsen financial outcomes and relationships. While that’s certainly possible, if discussions are navigated thoughtfully, a family can rewrite its cultural software.
- Complexity. Navigating family complexity requires frameworks. It also requires dialogue and the collective development of beliefs, perspectives and principles that guide the actions of the family.
- Inconsistency. To establish a productive family culture, family leaders help uncover ways to hold both individuals and the collective accountable. Family meetings and policies help to create a cadence of consistency that can align the entire family.
At Matter, we help families address these challenges in many ways, including through intentional work with family members on identifying their strengths, communication styles, values, and vision for the future. Through this work, we help families become familiar with their unique family culture and then collaborate with them to ensure that the technical aspects of their plans match their intentions.
Quoted material above is from the article “Wealth Planning Structures Must Match Family Cultures” published on WealthManagement.com