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Principle 3: Evolve a healthy family wealth culture

It’s fair to say that a culture is built on good communication—in fact, communication is how a culture is created and shared. From our work with many families over the years, we have identified best practices that can yield a family culture that reflects what most wealth creators want for their families and the transfer of their wealth: They want the wealth to be helpful, not harmful. Developing a healthy attitude toward the wealth as a family is an important element in making sure that it will be experienced in a positive manner.


Best practice #1: Preserve family history

Where you’ve come from and where you want to go. Pivotal choices that define you. Decisions you made that created your path. Celebrations, milestones, inspirations. Marriages, babies, homes, businesses. These can all be a rich part of your family’s story. Families who are already evolving a healthy family wealth culture tend to place a priority on what sustains and enriches them as a family—which has little to do with material wealth. 

Why is the element of “storytelling” so important in a healthy family culture? A key benefit is that a family story “frames” the focus and intent of legacy planning. In the past, clients often wanted to talk about maximizing their investment. However, more and more frequently, when clients begin to have conversations with their young adult children, they focus on the bigger issues of legacy, which almost require the family to begin sharing stories. The children bring that to the forefront.

When members of future generations realize they are now going to be guardians of the family’s history and values, they also start learning about how to be good financial stewards. There is a great hunger to learn more about and get better at stewardship. It’s really a journey through new stages for all generations, facilitated by developing the family’s collective story.

For the older adults, the opportunity to reflect on their life experiences and their own journeys often reveals wisdom that they didn’t realize they had to impart. And by sharing that journey, children and grandchildren have the opportunity to really know their elders, understand their family’s “back story” and begin to understand their own place in the family. 

How do families get started with the process of sharing and capturing stories? Storytelling interviews are nothing more than conversations with a plan. Preparing questions in advance can trigger memories, as can photographs, keepsakes or even music. However, despite being such an important and pleasurable activity, the exercise of actually preserving these stories is often pushed to the back burner. Although many express a desire to preserve and document family history, they frequently find it hard to make it happen. We have found that scheduling a time to get started, in a storytelling workshop, or by creating a family timeline, can be important first steps on a project that clients will not want to stop.


Best practice #2: Articulate a common purpose

Families that succeed in maintaining their legacy over generations have a shared vision and purpose. And they identify with it as a unifying purpose: It’s why it matters that we stick together as a family.

The challenge in articulating a common purpose is that there is much complexity, particularly with respect to what the future will be like. It’s important that a family can identify a common purpose clear enough to be actionable, but flexible enough to take into account changing circumstances. Many families who have succeeded in doing this think of it as a guiding star toward a future destination, with everyone headed in that direction together. The flexibility that should be built in reflects the need to acknowledge that the shared purpose must also support the individual purposes and realities of all of the family members, especially the younger generations. For some families, the second or third generation may feel they can never ‘compete’ with what the first-generation wealth creators have accomplished. But if a family does this right, it’s not about that. Instead, it’s about each generation making an imprint on the family wealth and legacy.

A hands-on exercise that can help a family articulate and bring to life its common purpose is developing a family crest or mission statement. This meaningful and fun-to-create visual or statement reflects the unique values central to the success of a family. Its elements can include values, motivating energy and motto—core principles needed to support the family’s work together toward becoming a stronger, more successful family. Creating a family crest or mission statement together also helps each family member understand how to use the family’s values to make family decisions together.


Best practice #3: Foster communication 

Sometimes it really is how you say it, not just what you say.

Good communication is critical to a healthy family life. Families that succeed through generational transitions of their legacy have developed real trust—and that trust is built through compassionate and candid conversation. The key to making sure conversations are meaningful and focused on working toward long-term vision and goals is for each family member to recognize that others’ communication styles may be quite different from his or her own.

While it can sometimes be challenging, it is important to see that every style has its strengths and weaknesses and that the healthiest families are those in which all of the styles are operating and honored. Having multiple communication styles in a family strengthens the family’s ability to make high-quality decisions that reflect the core values of the family. It also helps to understand how and why the family might be getting “stuck.” This often happens when one person is not feeling heard or where that person’s style is being disregarded. For example, one person whose style is to be direct and “get things done” may be disregarded in a group of people who want to make sure that everyone’s feelings are taken into account and will not move forward until “everyone is comfortable.” Engaging in a family communication clinic can give families a way to recognize, understand and accept others’ communication styles—the four basic styles that are common to almost all people: Decisive, persuasive, supportive and analytical. An assessment tool helps individuals figure out which one is their predominant style, understand how that can drive their conversation, and see what motivates and drives others whose styles are different.

The key word in the principle of “evolve a healthy family wealth culture” is evolve. Just as it takes a considerable amount of time and energy for a family to develop goals and engage in strategic planning that supports their legacy desires, it requires the same commitment for a family to preserve stories and history, articulate their common purpose and foster good communication. Once achieved, your family can know exactly what you mean when you say: “It’s the way we do things around here.”

Talk with your CIBC Private Wealth advisor about all of the resources available to you to implement the legacy planning principles.

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