The Statistics
70% of families fail to transition wealth to the 2nd generation and 91% to the 3rd
WEALTH CREATOR (GEN 1)
Children (Gen 2)
Their children (Gen 3)
Wealth rarely survives 3 generations
helping families succeed
70% of families fail to transition wealth to the 2nd generation and 91% to the 3rd
Families are like a spider's web; they are only as strong as their weakest link.
Families are also emotionally complex and unpredictable; they become markedly more complex as each new generation emerges.
They are made up of individuals who each have their own perspectives, beliefs, expectations, hopes, desires and fears. This creates the constant possibility for conflict to arise as wealth magnifies problems tenfold.
Wealth creators focus the vast majority of their energy on the Financial Capital - they build wealth and then look to preserve it through financial, legal, estate and tax planning.
As a consequence, they often fail to adequately address the family dynamics (the Human Capital) and therefore do not build an effective and harmonious team which can govern and control this wealth inter-generationally.
Naturally, wealth creators want to be in control; that's how they created this wealth in the first place. Most are also optimists believing they will live a healthy life into their 90's and beyond.
This often translates into them not sharing important information with key people until it’s too late. This can leave the family and wealth very exposed in the event the wealth creator becomes incapacitated or passes away and result in disastrous consequences.
