Preparing Heirs

One of the most common reasons families aren’t able to retain their assets and family harmony over multiple generations is they fail to prepare their heirs for the roles and responsibilities they will have to assume after Mom and Dad are gone.

There are several reasons this happens in families, but the most common reasons we see include:

  • Reluctance of parents to face their own mortality
  • Fear of creating a sense of entitlement and a loss of work ethic in their children
  • A desire to avoid discussing their estate plans with their children, particularly if they anticipate it might result in conflict
  • The issue doesn’t seem like a high priority in a very busy life
  • Mistakenly assuming that the will and trust will prevent these problems form occurring

Unfortunately, if you do not adequately prepare your children (including adult heirs) for the future they are almost certainly going to face, by default you are setting them up for failure. You may be unwittingly setting them up for what is known as Sudden Wealth Syndrome, a condition also commonly referred to as Lottery Winner Syndrome.

When inheritors receive large wealth in an unanticipated windfall, all too commonly that wealth comes with unwelcome emotional baggage. Feelings of embarrassment, unworthiness, and guilt are common because they know they didn’t earn it. Feeling overwhelmed by doubt and unexpected responsibility is also common. Suddenly your heirs find they have lots of new friends, not to mention relatives, who have loan requests and great investment ideas or business opportunities, and heirs often find it difficult to separate the wheat from the chaff.

Your children, grandchildren, or other heirs may be expected to step into your shoes to manage real estate portfolios, family businesses, and brokerage accounts with little to no prior experience.  They may also suddenly find themselves in brand new business relationships with partners who have previously simply been brothers, sisters, and cousins – very different relationship dynamics. Managing these newly complex relationships can often be overwhelming, particularly so if the familial relationships were challenging already.

Del Monte Group has a practiced, engaging, and fun process to make these transitions much more manageable for families who are willing to address the issues they face in a proactive way—ideally before Mom and Dad are gone.  We have many options and tools to help mentor and prepare your heirs for family leadership and financial literacy in a calm and comfortable way, before they actually need to assume the mantle of family leadership.  Talk to us today about how this might work in your family.