There are many iconic American families that come to mind when we think of vast family wealth. The Vanderbilts, for example, were one of the riches families in America in the 19th century. Cornelius Vanderbilt, the family patriarch, built his railroad and shipping fortune to $100 million before he died in 1877 – which was more than the U.S. Treasury held at the time.
That massive family fortune — which would be more than $200 billion in today’s dollars — has been gone for more than 40 years now. It did not even survive past three generations, primarily due to mismanagement by successive generations of heirs.
A recent Forbes article (it’s a great read, check it out) looked at ways to prepare heirs for an inheritance, with an emphasis on protecting and growing that inheritance. Here are some tips:
Share your vision. Conduct a family roundtable where the heads of the family come together with everyone and share their hopes and dreams for the family, as well as how they plan to reach their goals for the future. The idea is to start an open multi-generational dialogue.
Tell your story. To help younger generations understand the importance of protecting and growing inherited wealth, it helps if they first understand the values and visions of their predecessors. Sharing family memories, experiences and life lessons from older generations is one key component to ensuring the family story continues on well into the future.
Record your story. Your lasting legacy should be much more than just money; it should also be about those valuable intangibles that make your family unique, told through your insights, values and experience. We do this through our legacy planning process, helping you capture and pass on your own story and your aspirations for your loved ones through a special video we produce for each of our clients.
Gather together. Annual family retreats, gatherings, or reunions also help solidify family values and nurture common ground and goals. Consider holding an annual retreat where multiple generations can gather to bond, make plans for the future, and renew family harmony.
Family is one of the great human institutions. Yours can, and should, be the foundation for building real wealth – both financial and personal – for your children and for generations yet to come. With a little foresight and effort it can be done. You can do it. We can help.