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​The Risks of Transitioning Wealth

​IT’S MORE THAN JUST THE MONEY!

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Studies show that families who pass their assets on for many generations tend to adopt a broader focus beyond their financial wealth, including human and social factors.

Summary

Wealth planning should be a values-based process that enables everyone in a family to discuss their expectations, goals, and concerns before definitive plans are set in motion. By facilitating communication and collaboration among parents and heirs, values-based wealth planning helps families discover and articulate their personal, family, and social vision and values.

This issue of the Abbot Downing newsletter describes the importance of values-based planning to ensure a family’s wealth passes from generation to generation. It identifies risks beyond financial security and investment volatility to get to the heart of issues a family faces that can cause conflict. With a focus on collaboration, a family can work toward a shared vision for preserving family wealth. For those families with a business entity, we also provide best practices for successful business transitions.

KEY TAKEAWAYS

  • A family values statement of commonly held principles and goals provides the foundation for a sound legacy plan, one that inspires and motivates, and is both realistic and visionary.
  • Once in place, a clearly articulated vision statement can boost feelings of engagement and satisfaction, increasing the likelihood that family members can effectively work together to make important decisions about the future of the business and management of the family’s wealth.
  • Planning is never complete because life is not static. Ongoing reviews are essential to determine if tax laws, family, or economic issues have resulted in changes that need to be addressed.

Disclosures

Wells Fargo & Company and its affiliates do not render tax or legal advice.

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