Major financial crises occur approximately once every eight years. Educating the next generation to be effective stewards of a family fortune is of paramount importance.
Oxford Place works with families to educate the next generation in terms of their investing mindset, improving their technical skills and supervising their overall management of the family’s financial capital.
We all know growing up is hard to do – for both children and their parents.
A number of common parental concerns are presented to us with alarming frequency, all of which must be managed to ensure a successful estate transition.
The speech bubbles below contain examples of the most common concerns we help parents address.
Next Generation Checklist
Without realizing it, the majority of parents devote far more time to preparing the legal aspects of estate transition than preparing their heirs for the consequences of those documents; let alone consulting the heirs in sufficient detail to enable them to successfully manage the family’s wealth for future generations.
By working through the ten areas outlined in the checklist graphic, families are able to weight the likelihood of a successful transition significantly in the family’s best interests.
Communication Skills ✓
Mastery of Communication is a learned skill. The objective is to create empowering conversations between parents and children, so they move through communication blocks and establish a shared purpose across generations.
Presence and Influence ✓
Does each heir clearly understand how to express their “Presence” in a variety of social and business arenas? Is each heir equipped with the self-awareness to embody the family’s chosen values and positively express influence within the communities in which they live?
Listen and Be Understood ✓
Has each heir learned the skill of authentically listening to the family’s patriarchs and matriarchs? Are the heirs therefore aware of the concerns or anxieties their parents might have in relation to the successful transfer of wealth to their generation?
Habitual Frames of Reference ✓
Have both children and parents identified specific patterns of habitual communication, which negatively impact relationships and cause disharmony? These “Habitual Frames of Reference”, once uncovered, can be replaced by empowering attitudes and mindsets, which provide a solid platform for a successful estate transition.
Family Wealth Mission ✓
A family is strengthened by having a shared goal for the family’s wealth and agreeing on a set of values, which all generations wish to exhibit and live by.
Family Roles ✓
Is there cross-generational agreement and support for the specific roles each heir is invited to play in the maintenance and growth of the family wealth?
“Follow your Bliss” ✓
How does the family allow for the natural growth of each individual in order to identify and pursue their passions? How is the next generation supported as their ideals, goals and ambitions change over time?
Conflicting Aspirations ✓
Have the parents established whether a number of children might wish to take over the same role? If so, have both parents and children amicably resolved potential conflicts and established a solution and a program of preparation, which is objectively fair, measurable and agreed upon by all parties?
Handing Over The Baton ✓
The vast majority of transitions occur through the twin factors of old age and ill health. Families who create cross-generational buy-in for the timing and manner of the handover have a significantly higher chance of avoiding failure.
Financial Education ✓
Ensuring your heirs receive a solid education in strategic investment management and master a broad range of asset classes, is vital preparation for the next generation. When heirs understand how to assess investments critically, read balance sheets effectively and judge business ideas being pitched to them, they dramatically increase their ability to grow and preserve the family’s wealth.