“Can We Talk?” It’s Time to Be Candid About Family Dynamics

These were my opening words to the Dallas Council of Charitable Gift Planners: “Can we talk?” (spoken in a New York accent, channeling comedian Joan Rivers and her famous opening line). Having witnessed case after case of what happens when an inheritance falls into unprepared hands, I know all too well the disruption it causes in a family. Joan was joking, but this is no laughing matter. It’s time to “talk” candidly about family disharmony.

I’ve been helping families plan and pass down estates for 45 years. I can say with authority that, in one way or another, every family deals with challenging family dynamics. When you throw an inheritance into that mix, it’s like adding fuel to the fire. As the famous quote goes: “You never really know a person until you’ve shared an inheritance with them.”

Here are a few stories I’ve witnessed that served as wake-up calls to shift me from “head” estate planning to “head & heart” estate planning:

  • A well-meaning grandparent left a trust that doles out a monthly allowance to a grandchild, who now lives a sad and unproductive life in the grandparent’s mansion. The grandchild has no reason to get out of bed in the morning.
  • Siblings at war over control of a family business, a business that has provided generously for three generations, yet is now the source of intense jealousy and hate.
  • Battling siblings challenging a deathbed Will that left family legacy assets all to one child instead of equally to all three.
  • Attending a conference for owners of Family Offices, where the session garnering the biggest turn-out and interest wasn’t a session on investing, tax planning, estate planning, or money management. It was a presentation on substance abuse and addiction. Every family in attendance was dealing with this problem at some level.
  • My own brother’s death at age 65, where the reality hit me hard that a stack of estate planning documents isn’t just about trust structures and saving tax; those documents affect lives. We need to think carefully about the impact of our planning on loved ones we leave behind. It’s not just a bunch of words.

I give a lot of speeches on the topic of Family Legacy Planning, searching for ways to help families improve the odds of multi-generational success. I’ve shared a similar PowerPoint with you before, but for convenience, here’s a link to my recent Dallas speech “In Search of ‘Family Glue.” The statistics are daunting, as 90% fall victim to the adage “shirtsleeves to shirtsleeves in three generations.” In this speech, I covered the “Best Practices” of the 10% who succeed.

We will soon wrap up the eight-day Passover holiday, and it brings to mind a part of our Passover Seder celebration where the youngest in the room asks “The Four Questions.” During the Seder, we offer answers to those questions. Similarly, I opened my speech with a different version of Four Questions, along with suggested answers. Here’s a recap of that Q & A:

  1. Q: What keeps you awake at night? A: It’s usually not your money or your investments; most of the time, it’s your family—wanting them to live happy, productive lives.
  2. Q: To what end have I created this wealth? A: My hope is that the assets I leave behind will be used for good and not tear apart my family.
  3. Q: What’s the right amount to leave your kids? A: It’s the amount they’re prepared to receive.
  4. Q: Are your kids and grandkids ready for the inheritance coming their way? A: If not, it’s important to start taking intentional steps to prepare them for it.

As a final point, I’ll reiterate that the “inheritance” that’s passing down to your loved ones isn’t just money. As Jay Hughes teaches in Family Wealth: Keeping It in the Family, the word “it” doesn’t mean money. “It” refers to five sources of family wealth: Financial Capital, Human Capital, Spiritual Capital, Social Capital, and Intellectual Capital. Hughes quotes a grandmother who got “it” when she said: “Our family has always been rich, and we’ve sometimes had money.”

Wishing all a meaningful holiday experience during this spiritual season,
Marvin E. Blum

Marvin Blum had the recent privilege of speaking about “Family Glue” to the Dallas Council of Charitable Gift Planners.