Future Proofing Family Wealth
The adage “from shirtsleeves to shirtsleeves in three generations” describes the common three-generation cycle of a family business.Family ties and business are a difficult combination, which unless correctly managed can threaten their wealth and long-term well being.The emotive blend of family, wealth and business has the potential to not only weaken the family as a unit but also the family business. But, if properly managed, this same emotive blend has the potential to strengthen the family and add to the success of its business.A family and its business' unique dynamic requires a proactive strategy so that when carefully managed, the cohesion, pride, and commitment provided by the family can help the family strengthen in relation to its peers and can set its business ahead of its competitors.Robust family and business structures and careful dynastic planning are the corner stones of risk management for a family and its business. These are the keys to unlock the ability of a family and its business to survive in the long term and to ensure the financial well being of future generations.In today's environment, there is an ever-growing need for sound structural and financial planning advice required by high net worth (HNW) families. Regrettably, too many of these families are so busy growing their businesses and their current wealth that they tend to overlook fundamental steps to protect themselves from the future.Some of the key concepts that families should consider are:
- Retirement and Dynastic Planning
- Family governance and family agreements incorporating mechanisms to resolve family disagreements
- Review, and if necessary, reorganisation of existing structures
- Possible use of specialist structures (trusts, foundations etc.) to protect business or family interests.