Wealth Enterprise Approach to Planning

Planning for the transfer of family wealth is multi-dimensional and dynamic. The people, assets and circumstances that affect a family’s wealth transfer plan are numerous and they change over time. In addition, the family’s wealth transfer plan must harmonize with the family’s overall wealth enterprise® – including family governance. Some wealthy families avoid planning when they feel overwhelmed by the task. Other families implement their plan in a piecemeal fashion (several small planning initiatives over the years with different advisors) that may result in planning that is partially outdated and disjointed. Other families fail to grasp the important family governance implications of planning, and how the decisions they make in their estate plans will impact the decision- making dynamic of the family.

When family wealth reaches a certain level of size and complexity, it becomes useful for a family to approach wealth planning differently. Rather than viewing a family’s wealth in pieces, it should be viewed holistically, as a business or enterprise. Rather than a ‘ad hoc” or “as necessary” approach, management of substantial wealth should be approached as an organized and proactive function, guided by the values of the family. All too often, unintended consequences can be significant and damaging – taking an active approach helps ensure the family’s intentions guide the enterprise, and reduce the risk of negative repercussions commonly associated with poor management.

Planning the transfer of family wealth should begin with a thoughtful exploration of the family’s values, needs and objectives. The family should pay attention to the way they make decisions today and how they are likely to make decisions in the future. Gathering and thoroughly reviewing this information is invaluable when creating and executing any wealth transfer plan. Each family member should be taken into account and factored into planning decisions.

Armed with this information, the advisor can evaluate and make recommendations on how the specific asset transfer goals might be better achieved. A critical component is communication between the family and legal service providers and it is an area where a family office advisor can play a valuable role, both with design and implementation. Once a plan is executed, ongoing monitoring is necessary to make changes according to life’s curveballs and often ill-timed sense of irony.

In addition to robust, holistic planning, a family can also benefit from global resources now available to estate planners. Joseph Kellogg, WE’s wealth planning executive, comments in the attached video on the benefits he has received as a member of the professional association “Society of Trust and Estate Practitioners” (STEP), and how those benefits impact client service. Joseph is former Chair of the STEP Miami Branch and currently is an officer of STEP USA, the regional umbrella body overseeing all STEP USA Branches.

WE Family Offices advisors are not estate planners. Neither WE Family Offices nor its employees provide legal or tax advice and our wealth planning services are not intended to provide, and should not be construed as providing, such advice. Clients must consult with their legal and tax advisors regarding the legal and tax implications of any planning recommendations.

Disclosure
This communication contains our current opinions and commentary, and does not represent a recommendation of any particular security, strategy, investment product or manager. The views expressed here are subject to change without notice. This commentary is distributed for educational purposes only and should not be considered as investment advice or an offer of any security or service for sale. Information contained herein has been obtained from sources we believe to be reliable, but we do not guarantee its completeness or accuracy. No part of this letter may be reproduced in any form, or referred to in any other publication, without WE’s written permission.