Secure Your Legacy with a Family Philosophy of Wealth

Robert Balentine
October 1, 2018
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The Tony-award winning musical “Hamilton” has played to rave reviews both on and off Broadway. One of the most prolific attributes of the titular founding father—and an overarching theme of the musical—is the copious amounts of writings he produced during his lifetime. This is in stark contrast to today’s world of abbreviated communications—tweets under 280 characters, emojis instead of words, and even the ability to “like” a message in lieu of writing a response.

However, storytelling and documenting à la Alexander Hamilton still has an important place in modern times. For entrepreneurs, business owners, and patriarchs/matriarchs, a family philosophy of wealth is an important means of keeping future generations engaged in sustaining the family legacy.

What Is a Family Philosophy of Wealth?

Your family’s philosophy of wealth can be as brief or detailed as you desire. If you fashion yourself more like Twitter CEO Jack Dorsey, a short mission statement may be appropriate. On the other hand, a comprehensive account of your family’s history and legacy may appeal to the modern-day Alexander Hamiltons in your brood.

Typically, a philosophy of wealth includes a family’s mission, values, and ultimate desired legacy. As I asked one client, “What do you want your grandchildren’s grandchildren to know about you?” It’s especially important for a first-generation wealth creator, such as an entrepreneur who has sold his company, to record how the wealth was created in the first place.

Family philosophies of wealth are also important when a portion of the family’s wealth is tied up in an illiquid asset owned by multiple family members and/or generations. One such example is the historic Millpond Plantation in Thomasville, GA, which hit the market in September 2017 for $25 million. While many factors ultimately go into the decision about when to sell or how to divide an illiquid asset, an appreciation of the legacy should be a meaningful part of that decision.

Just as Balentine has values which guide our firm, it’s important for families to establish their own values. This is particularly helpful if you have a family foundation, as those values can serve as guidelines when determining which charitable causes to support. Some philosophies of wealth even include codes of conduct or standards one must follow in order to participate in family decision-making.

How to Create a Family Philosophy of Wealth

The first question to ask when creating a family philosophy of wealth is which family members should be involved. In the case of large families with established wealth, it could be a beneficial exercise for all adult family members to attend. Be warned, however, that it could reveal some underlying tensions. If you worry this may be the case, consider bringing in an outside facilitator to help navigate this conversation; Balentine has often played this role for clients.

If you plan to lead the exercise yourself, prepare a list of questions in advance to help guide the discussion and ensure you address all the most important matters. Examples of questions you should consider include:

  • What values do we hold most dear?
  • How do we want to be remembered?
  • How do we define wealth—or does our wealth define us?
  • What does it mean to be successful?
  • Which causes are most important to us?

Once you’ve created your family philosophy of wealth, you must decide how you’d like it recorded. While some are simply jotted down on a piece of paper, others are more formal. I have seen families hire graphic designers to create glossy brochures or historical archives. Balentine’s Atlanta and Raleigh offices both have “history walls” to tell the story of our founding, complete with scanned letters, articles, and photographs dating back to the 1980s.

Others may decide to write a book or authorize a biography. In our modern age, video has become a popular means of documentation. Recently, my family and I recorded a video to discuss our creation of the not-for-profit Southern Highlands Reserve. Regardless of which method you and your family end up choosing—whether a largescale production or a simple sheet of paper—the important thing is to document your wealth philosophy.

At the climax of “Hamilton,” Alexander sings, “What is a legacy? It’s planting seeds in a garden you never get to see.” While this likely will be true for us all, creating a family philosophy of wealth will help to ensure your grandchildren and theirgrandchildren can appreciate your family’s history and continue to uphold and expand upon your legacy.

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