The Essential Elements for Successful Family Wealth Transfers

Written by Tim Decker.

stacking-coinsCommunication & Planning vs. Shirt Sleeve to Shirt Sleeve in 3 Generations

It is inevitable; we get older every day. The time to begin the planning for the next generation is now. The complexities of the family and the amount of money moving to the next generation can help determine how much time and effort will be required to ensure success for future generations. The creation of wealth bares a new set of responsibilities. If you would like the transfer of your wealth to benefit the next generation, then you need to consider involving your family early. Each person's goals, values, and ambitions might not align, but this is a time to find common ground. For success, it will be important for each generation to understand each others' perspectives; square peg, round hole – futile.

Family conversations regarding money and how the next generation will handle an inheritance practically, are difficult to say the least. Talking about estate planning, retirement planning, elder care and what will happen to investments is not an easy discussion, but it is paramount to ensuring that a family's wealth is protected before a transfer takes place. In this article, I will identify some of the key issues involved in family wealth transfers and the emotional and practical aspects of the process.

TALK - Family Money Meetings

  • Talk - Have family discussions about money long before they are critical.
  • Ask - Ask as many questions as you can think of - no matter how insignificant you think they may be.
  • Listen - Listen to each other and be understanding of one another's wants, needs and emotions.
  • Keep it up - Continue the conversation - it doesn't need to only happen once.


Goals and Objectives. Have a complete understanding of each participant's goals and objectives for their lives. Keep in mind that it is possible that some parties may have already spent a great deal of time thinking about this while others may not have. This is an opportunity to get everyone on the same page. The creators of the wealth may have some expectations that must be communicated to ensure a sound succession. A trusted family financial advisor can be very beneficial at this juncture. As a mediator, it can help everyone gain clarity on the future and reduce the stress that may come as a result of not knowing. All parties should be prepared to discuss any concerns about these plans. If the parents, for example, are planning to retire abroad, how will the family get together and who will care for them in the event of serious illness? If one child does not wish to participate in the family business how do you adjust? Is there a legacy that is important to the creators of the wealth?

Estate Plan. This is about having all estate planning documents in order and up to date. Parents should make decisions about their care in the event they become incapacitated. Who would care for them? Who would have powers of attorney over their assets? Who is the executor or trustee of their estate in the event of their death? From the children's point of view, they might suggest the best family member to handle each of these tasks. Factors might include physical proximity to their parents and who is best in dealing with money issues. The children will need to ensure that any powers given in their parents' documents align with their own.

Key Documents and Digital Assets. It is important that everyone knows where key documents and papers are located. Parents should make a list of their key documents and papers and where they are located. In our digital age it is also important to know the logins and passwords for all critical accounts, document servers, social media pages, etc. Children can help their parents determine what documents are in place and which may need updating or creation.


As mentioned earlier, having a trusted financial advisor can help serve as a facilitator of a conversation, if needed. It is important that the conversation stays on topic, and not allow personal differences to get in the way. Remember there will likely be gaps that must be filled. If there are assumptions being made from either the parents or the children, those assumptions can be clarified or organized into plans, goals, and solutions so that they are no longer unresolved.


Family money conversations can be difficult, but they are vital to properly executing a parent's wishes in terms of the eventual transfer of their wealth to their children. We strongly encourage you to have ongoing family discussions regarding money issues and wealth transfers. And as I like to say, over-communication is never a bad thing, especially when it comes to those you love and care about the most.

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This content is based upon information believed to be accurate by ISI Financial Group, Inc. However, it should not be relied upon for legal or accounting purposes. You should always use the custodian's brokerage statements as an accurate reflection of your portfolio. Past performance is not indicative of future performance. Investments involve risk, including the possible loss of principal. Always seek professional advice before making any financial or legal decisions.

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