Legacy principle series: Integrate planning for family wealth

What does ‘integrated planning’ really mean?

When clients ask us this question, we often tell them to ‘picture your wealth plan.’ It sounds like a simple thing to do, and yet, for many families, articulating what they envision as a legacy for the wealth they have created or inherited can be a daunting task with a sense that what they do should echo across generations. Creating a long-term, overall family wealth plan is an evolving process, beginning, as all things do, with a first step and developing as your family, circumstances and goals change.

Families who embrace the principle of integrating wealth planning into their overall financial picture engage in certain best practices that help a family bring its vision to life.

Best practice #1: Engage in strategic planning
Families who are successful with integrated planning put themselves in a strong position to be successful in transitioning wealth to future generations. It starts with understanding the current wealth plan structure, evaluating current family circumstances and creating a framework within which to consider changes that may better meet family wealth goals.

The primary goal of our wealth plan review is to simplify the complexities that often come with wealth, presenting an assessment of the client’s current situation and a review of long-term goals. This allows clients to reflect on what they currently have in place and compare that to their current family and financial situations. In some cases, the plan on paper and the picture in the client’s mind are in perfect alignment. But often, the plan and the picture do not quite match up, either because of the passage of time, changed family circumstances or simply because the client does not remember what the documents provide. Our method of organizing and simplifying helps clients understand clearly what is, as well as what could be. Beyond that, this practice allows us to make observations and offer thoughts to consider based on our experience.

Our process is to present our clients with a simplified picture of their wealth — helping clients understand what’s in place and where changes need to be made to reflect their vision. These are the conversations that allow us to help clients (1) develop their family wealth goals and (2) discuss planning options to determine what strategies will best meet those goals, two critical best practices of families who are successful in transitioning wealth to future generations.

Best practice #2: Revisit planning regularly
Planning should never really be ‘finished’. As we work with clients, we engage regularly in ongoing conversations with them about their families and their circumstances, and how changes can impact how they wish to use and enjoy what they have built for themselves. These conversations evolve naturally in the course of our relationships but evaluating life’s changing circumstances can often use a little help to get started. As clients think about the wealth they have created and how they want to use it, it can be helpful to think about the following questions as family circumstances and dynamics change.

• Lifetime cash flow – How have lifetime dreams evolved and will available finances support them?
• Wealth transfer – Have priorities changed regarding what family members should receive and how they should use it?
• Philanthropy – What philanthropic causes are important to the client today, and what are the most effective ways to fulfill the philanthropic vision?
• Legacy – How does the client want to be remembered and how would they like the wealth used?

Our holistic, integrated process, which engages the family around the planning they have in place and whether that matches what they envision over time has proved to be an effective method to help the family identify and articulate planning goals and keep their planning fresh as life changes.

Best practice #3: Involve collaborative advisors
A very important part of integrated wealth planning is recognizing the fundamental truth in a quote from Aristotle: “The whole is greater than the sum of its parts.” This is well understood by those who are successful in creating lasting legacies, and it sums up how we view teamwork and collaboration, both among the CIBC Private Wealth team and between our team and other advisors.

Wealth transfer planning is a complex process that almost always requires multiple perspectives and strategies from a team of advisors with multi-disciplinary skills. For many clients, our advisor summit and its emphasis on the importance of coordinating and collaborating with the various advisors involved brings significant value because it combines the breadth of knowledge and skills from all parties, ranging from attorneys to accountants, insurance specialists and, often, business advisors.

Best results for the client always come from a spirit of collaboration. At a minimum, the relationship manager will seek to coordinate with the other advisors in advance of the annual review, sharing thoughts on next steps and asking for input. The relationship among the team of advisors should take on a life of its own after a while and be an integral part of any wealth planning model.

The possibilities of planning for family wealth are abundant. So is the scope of resources available to you through CIBC Private Wealth. Integrated and strategic planning for retirement, wealth preservation, business transition, estate planning implementation, and much more lays the foundation for “living” the principles of legacy planning.