Topics for Discussion - Chapter One

Do you tend to speak of "ownership" of financial assets or "stewardship" of
wealth ?

Before beginning to develop specific transition plans, it is helpful to
understand what comprises family wealth and family wealth. Once you're
comfortable thinking of family wealth in terms of its financial, human and
social capital, you may reconsider what comprises success in family wealth
transition continuity and how to think about what stewardship of family
wealth means.

In Family Wealth Transition Planning we define success as family wealth
continuity - a family's ongoing ability and willingness to make human,
social, and financial capital available to its members at the "right" stage
in their lives and in the right way. We identify the three pillars of
family wealth continuity as healthy family relationships, responsible
stewardship of family wealth in all its forms, and the ongoing creation of a
family legacy. In addition, we identify four fundamental questions for
families to consider while working on transition plans.

1. What kinds of wealth are being transferred?

2. From and to whom will wealth be transferred, and will it pass
inside or outside the family?

3. When will the transitions occur - now or later, suddenly or
gradually?

4. How will each transition occur? By gift or sale or both? Under
what conditions? How will the wealth be shared among recipients, if at all?

We suggest that stewardship of wealth means the responsible administration, supervision, management, and use of resources such as time, money, people, and talent. For more detail about family wealth continuity, please see Chapter 1 of Family Wealth Transition Planning. Also, please consider sharing your own definitions and questions here.

Family Wealth Transition Planning (FWTP)

When families transition business wealth from one generation to the next, things can quickly become complicated. Difficult questions arise, family ties are stressed, and storms quickly spread over what were once were calm waters. In the midst of transition, families turn to the advisers they trust most, be they lawyers, accountants, financial advisers or family business consultants. In Family Wealth Transition Planning, Bonnie Brown Hartley and Gwendolyn Griffith guide advisers down the tumultuous path of transition planning, teaching them how to help a business family find both financial and personal success during succession.

This blog will provide commentary on the book's topics by the authors and members of the family wealth adviser community. The authors will guide discussions by posting questions that will help advisers probe:

>The opportunities and dangers of family wealth transition planning (FWTP)·
>The impact of individual, family and business life cycles on FWTP·
>The role of the family’s financial, social and human capital in FWTP ·
>The needs and expectations of the stakeholders in the family, business, investment and philanthropic systems in FWTP·
>The ways governance structures and processes support family wealth continuity·
>The role of the adviser as a member of an interdisciplinary team.