Connect with us

Life Transitions

Why Legacy Matters to Estate & Succession Planning


Why Legacy Matters to Estate & Succession Planning

There is a huge unmet demand to provide a solution that can marry the client’s values with their valuables.

Advisors need to know that their client’s life experience, the lessons learned and the hard won wisdom cannot be listed on a balance sheet or constrained to a legal document.

Professionals in Wealth Management, Succession Planning and Estate Planning are keenly aware of the failure rates related to inter-generational wealth transfers. Regardless of size many estates fail in the second generation and fewer still survive the third. The reasons have less to do with math and much more so with the ‘human’ factor. Strategies currently employed by the industry to deal with this problem are found to be wanting.

The answer lies in finding a way for succeeding generations to take responsibility for, as well as ‘ownership’ of, the gifts they receive. But, they cannot be expected to be invested in perpetuating the family narrative if they don’t know it. Appreciation of the herculean efforts, the incredible risks, the sweat, the tears and the vision it took to create the wealth can be accomplished, to a degree, through sharing the story. When heirs know their history and understand their unique family narrative they more readily see themselves as an integral part of that greater story.

There are problems though when contemplating building a legacy.

Too many assume a family history needs to be a written story, edited and published in a book. Many also fail to see the value in such an exercise, believing it too pretentious. Beyond this humility, they face the challenges of: feeling they lack the requisite skills, a sense of being overwhelmed by the task, not knowing where to begin, and lastly, procrastination.

To address this problem, Ascent Private Capital Management, a private banking unit of U.S. Bank has hired an historian to manage an asset that some families cherish as much as their money: their legacies.

“We know that managing the wealth of families is much more than managing their money,” said Scott Winget, Ascent’s senior managing director and head of wealth impact planning. “Using a family history helps establish what a family’s values are.”

I applaud Ascent’s vision; it’s the right thing to do. It would be nice though if other firms would embrace this initiative and unlike Ascent, provide it to some of those families who don’t quite have $50 Million to invest.

Continue Reading