Best Practices for Integrated Family Wealth Planning

Cathy Schnaubelt
September 06, 2018

Legacy planning is an opportunity for families to define their values while creating long-term objectives to their wealth. While preserving wealth and developing an effective approach to pass it from generation to generation is often a challenge, sometimes the most difficult aspect of legacy planning is knowing when and how to integrate younger generations and trusted advisors. When it comes...

Legacy planning is an opportunity for families to define their values while creating long-term objectives to their wealth. While preserving wealth and developing an effective approach to pass it from generation to generation is often a challenge, sometimes the most difficult aspect of legacy planning is knowing when and how to integrate younger generations and trusted advisors. When it comes to engaging others in the legacy planning process, the most successful families typically implement three common best practices. 

Develop your wealth goals. Developing financial goals is often easier said than done, especially when considering longer-term goals such as wealth transfer, charitable giving and legacy objectives. Of course, these goals are in addition to your immediate and near-term cash-flow needs. Documenting these goals is an essential first step in establishing your financial and wealth management plans. 

As you think about legacy planning, your family culture and dynamics—specifically, your collective values, as well as how you communicate and make decisions together—may largely influence your goals. Including your family and loved ones in the goal-setting discussion can help ensure that you are all working towards the same long-term objectives. When family members understand the role of wealth in their lives and engage in open dialogue, they are in a better position to create a meaningful and sustainable legacy.

Engage in strategic planning. After discussing and documenting your goals, the next step is developing a plan to achieve them. Strategic legacy planning aligns your investment strategy and overall wealth management approach with your long-term financial, philanthropic and family legacy goals. Before getting started, it can be helpful to reflect on the plans you already have in place and determine how well they represent the values and objectives you and your family have discussed. 

This stage of the process often includes anticipating and providing for the financial needs of future generations, aligning the goals of multiple generations, and teaching children and grandchildren to be financially responsible. Families that integrate and engage younger generations in the planning process, while educating them about important financial concepts, are often more successful in preserving wealth and sustaining the legacy they desire. 

Collaborate with other specialists. One of the most important components of integrated wealth planning is collaboration—not only with members of your family, but with other professionals and trusted advisors in addition to your primary wealth advisor. Wealth transfer planning is a complex process that almost always requires multiple perspectives and strategies from a team of specialists with multi-disciplinary skills. 

This step of the process often brings the most value because it combines the breadth of knowledge and skills from all parties, ranging from attorneys to accountants, insurance specialists and, when necessary, business advisors. If possible, meeting with your team of advisors at least once a year is often most beneficial when it comes to staying on track with your wealth and legacy goals. 

Your wealth plan will evolve as your family dynamics and financial circumstances change, and if you are like most families, articulating what you envision as a legacy for the wealth you have created or inherited can be a daunting task. However, open and honest discussion with your family members, loved ones and trusted advisors can help you develop a plan to successfully map out and achieve this vision. Legacy planning is an ongoing and collaborative process; if you are unsure of the best place to start or need help aligning your financial plan with your long-term goals, talk to your wealth advisor about beginning the journey. 

Cathy Schnaubelt is a senior wealth strategist for CIBC Private Wealth Management's Houston office, with more than 35 years of industry experience. In this role, Cathy is responsible for the development of integrated wealth management solutions and provides comprehensive estate and financial planning services to high net worth clients.

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This article originally appeared on Forbes.com on Aug. 2, 2018.