Talking about family wealth: video seriesWealth opens the door to extraordinary opportunity, but it can also bring with it unique challenges. In an exclusive series of videos below, members of, and advisers to, wealthy families speak openly about their experience of these often sensitive issues.
We are delighted to share a series of video conversations on the dilemmas and challenges often faced by wealthy families. In different capacities, our panel of experts all have first-hand experience of these issues. We are grateful to them for their insights and sharing their experience and expertise. Our panel comprises:
Leonie Schroder, Non-Executive Director, Schroders PLC
Julia Samuel MBE, Psychotherapist and Author
Tori Cadogan, Journalist and Editor
Clare Anderson, UK Head Schroders Family Office Service
When we talk to wealthy families about their greatest concerns, family dispute, poor leadership and intergenerational conflict almost always top the list. A survey of some of our wealthiest clients shows that these risks are of far greater concern than investment performance, tax and inflation. This remains the case despite the profound shifts we have seen in the global economy and markets in recent years.
If anything, the need for advice on the long-term stewardship of family wealth has grown: the past few years have seen unprecedented levels of wealth crystallisation as a result of business sales and other corporate transactions. Many of the individuals involved have turned to us for guidance.
To discuss any of the issues raised, please do get in touch at email@example.com.
What money means in your family
Money doesn’t define your family – relationships do. Our panel explains how talking openly can help avoid the misunderstandings that money can give rise to.
Talking to children about money
Children of very wealthy families are unlikely to fully understand their unique circumstances when you first explain it to them. Expect an ongoing conversation. An open door and the ability to talk freely to other family members and trusted advisers will help.
Expectations of inheritance
When wealth has already passed through multiple generations, there may be a strong set of expectations around how it is transferred. Wealth creators, on the other hand, face the challenge of creating a culture and framework that facilitate it. Open and honest communication between the generations will help.
Communication within families
Wealthy families often include strong personalities who may be used to getting their own way. This can inevitably lead to tensions. Third parties may be able to help steer difficult conversations and avoid replaying old arguments.
Purpose and identity
Wealth creators need to think carefully about the culture and values they build around their wealth. Ideally, this will foster a sense of family purpose while allowing the next generation the freedom and confidence to forge its own path.
Supporting younger family members
Ensuring your children have a sense of purpose and ambition – whichever direction that may lie in – is a key preoccupation. Helping older children and young adults understand their privileged position is also a priority. Involving them in family philanthropy can help.
Benefits of altruism
Philanthropy and volunteering can enable members of wealthy families to broaden their range of experiences. Your own energy and enthusiasm can set a powerful example to your children. However, they are likely to be more engaged if allowed the freedom to find their own causes at the right time for them.
Family tension: coping with change, conflict and crisis
Some change is expected, but some – such as divorce or a dispute – may not be. Pre-existing faultlines can be exposed and cause minor tensions to escalate. Time, and creating the space for honest conversation amongst family members, will help navigate these periods of transition.
Lessons for inheritors
We inherit many of our values from previous generations, but all too often they can bring us into conflict with the next. Engaging with, and potentially challenging, these hereditary beliefs can help chart a way forward for both younger and older family members.
Making wealth work for you
Members of wealthy families may never be able to entirely escape from assumptions and judgements about their background. Inevitably, wealth will form part of their sense of identity. However, identities need not be defined by it.
What binds a family
Inheritors often feel like they are custodians not just of a family’s wealth, but also their values and beliefs. This often provides a strong sense of purpose. It can also be a powerful reminder of the emotional ties between family members and generations.
Managing wealth for future generations
The next generation may have very different views on the stewardship and purpose of their family’s wealth from their parents and grandparents. This can be a source of tension. However, engaging with the views of different generations and different branches of a family can foster a real sense of community.
To discuss your family's requirements, please contact us.