“We have met the enemy, and it is
us.” Pogo
A. Two Problems, One Cause
The
voice on the phone was filled with panic.
It was a seasoned and successful financial advisor from the Northeast
and he was worried. One of his best
clients had died recently and things were spinning out of control.
“His children won’t talk to me. They’ve even hired a new estate settlement attorney. I’m going to lose $2 million of assets I have
under management and the $5 million of life insurance proceeds I set up for
them in a dynasty trust. They don’t seem
to appreciate all I’ve done for them. What
can I do? How can I hang on to this business?”
I
had to break the bad news to him that, at this stage of the game, there wasn’t
much he could do because his client’s children and grandchildren barely knew
him. All the great service he had given
his client and all the great planning he had done for his client were not going
to help him with his client’s children.
Sadly,
this episode is repeated frequently, very frequently.
98% of the time, professional
wealth advisors lose their client’s business within one year of the death of
their client.
This
phenomenon, well known to observant practitioners, has been documented by several
in-depth studies, including a recent survey conducted by Price Waterhouse
Coopers, Global Private Banking/Wealth Management Group. This incredibly high attrition rate of 98% has
severe implications for advisors wishing to maintain their firm’s profitability
and eventually sell their practices.
Unfortunately,
the client’s children and grandchildren won’t fare much better, even with the
decedent’s millions. Unbeknownst to
them, in all likelihood they are already on their own financial and relational
death spiral.
90% of the time, the wealth and
solidarity of affluent families are dissipated by the end of the third
generation.
This
phenomenon is so universal that it is encapsulated in a similar proverb in nearly
every country on earth. In the US, it is
“Shirt sleeves to shirt sleeves in three generations.” In Holland and Ireland, it is “Clogs to clogs
in three generations.” In China, it is
“Rice paddy to rice paddy in three generations.”
As
my friend and colleague Courtney Pullen wrote in the Introduction to his
brand-new book, Intentional Wealth:
“From shirt sleeves to shirt sleeves in three
generations.” This is an ancient saying
about the fleeting nature of wealth, and modern research has confirmed its
accuracy. Approximately 90% of affluent
families lose their wealth by the end of the third generation. The tragedy of this statistic isn’t the loss
of the money; it’s the loss of the family that goes with it. As the wealth dissipates, so does the
connective tissue of the family, whose members often end up disconnected and
embroiled in conflict.”
B. The root cause for both these stark failures is the
same: our method of planning.
The
cause for failed multigenerational families and failed multigenerational
advisory relationships is the traditional planning paradigm, which is founded
on a mindset of superiority, secrecy,
and control. It works like this:
When
affluent clients set out to create a plan for the perpetuation of their wealth
and their values across multiple generations, they typically assume that they
and they alone know what’s best for their descendants and they have the right
to dictate the rules. After all, it is
their money. Many are well-intended: they
may wish to shelter or protect their descendants from the challenges and
complexities of creating these plans.
Regardless of the clients’ motivations, family members most affected by
these plans are seldom consulted except in the most superficial ways.
The
clients’ old-school professional advisors, locked in the mindset of the
traditional planning paradigm, reinforce this patronizing attitude because it
plays into their own mindset of superiority and control. This creates an echo chamber in which clients
and advisors hear only what they want to hear.
And
lest anyone slow down the planning in progress or undo it once it is written, the
entire process is cloaked in secrecy.
Family member don’t speak to advisors and advisors don’t speak to family
members except until the very end when, in the stereotypical “reading of the
will” the great plan is finally unveiled.
By
then, the die for the family dynasty is cast.
The surviving family members’ lives for the next several generations have
been largely determined without their even being consulted. As it turns out, the so-called “objects of
the client’s bounty” are merely pawns in the process. The result is the objectification and infantilization of the clients’ children and
grandchildren. The plan—carefully
crafted by the client and his advisors—becomes a patronizing, self-fulfilling
prophecy.
It
is highly unlikely that those who are thus neutered by being treated by their
parents and grandparents as objects and infants will succeed in maintaining and
building the family wealth or family relationships beyond their own
generation. Instead, they will — 90% of
the time — go to great lengths to resist and eventually dismantle their
parents’ planning.
It
is highly unlikely the client’s children and grandchildren will feel much
affection for their parents’ “co-conspirators,” the professional advisors who
devised the plans that now hold them hostage.
Instead, they will — 98% of the time — fire those advisors and hire
others more sympathetic to their point of view.
It
is no small irony that the planning process itself, the very process that is intended
to perpetuate the client’s success and make his advisors indispensable to the
heirs, plants the seeds of failure on both counts.
C. Two Problems, One Solution: SunBridge 3-GEN Planning
Einstein
defined insanity as continuing to do things as they’ve always been done while
expecting a different result. For those
astute enough to recognize that the old paradigm of planning doesn’t work, it’s
clear we’ve got to re-think the way we plan.
Fortunately, there is a solution
to both these serious problems. It
is a new—but actually age-old—approach to planning called “SunBridge 3-GEN
Planning.”
What
is SunBridge 3-GEN Planning?
- In SunBridge 3-GEN Planning, planning isn’t something we do to our family, or even for our family. It’s something we do with our family.
- In SunBridge 3-GEN Planning, planning isn’t a lecture the patriarch delivers to his posterity through a megaphone, it’s a thoughtful and respectful conversation among all of them.
- In SunBridge 3-GEN Planning we stop treating the clients’ children and grandchildren as mere objects or pawns. We treat them as real people who have a real stake in this process.
- In SunBridge 3-GEN Planning we stop infantilizing the clients’ children and grandchildren in a misguided quest to build a family dynasty by fiat. After all, why worry about the 7th generation if your family and your wealth aren’t going to survive past the 3rd? What good is a 100-year plan if your children and grandchildren are falling apart today, and will be tearing each other apart as soon as you’re gone?
- In SunBridge 3-GEN Planning, three generations come together to create a blueprint for a happy and successful life for everyone, both today and tomorrow.
- In SunBridge 3-GEN Planning, we bring everyone to the table and discover solutions to the family’s biggest questions. Then we implement them.
- In SunBridge 3-GEN Planning, the advisory team assumes the role of educating and mentoring family members and guiding them into a new collaborative model of family dynamics.
The
plan that emerges from the SunBridge 3-GEN Planning process is a shared,
collaborative plan, built by the family working together with their trusted
advisors. Not everyone gets everything
they want, but they get a voice and a place at the table.
Since
everyone has a say, everyone buys in and takes ownership. Everyone takes responsibility for making it
work, not only for their generation but for generations to come. No more “shirtsleeves to shirtsleeves.”
As
a SunBridge 3-GEN Planner, you connect with your clients’ children and
grandchildren naturally and organically during these planning experiences. They know you and trust you, so of course
they will turn to you for advice and counsel when their parent or grandparent
passes on. Unlike 98% of your peers, you
will not lose the business when the patriarch dies. This will secure the long-term value of your
business.
E. SunBridge teaches advisors how to become 3-GEN
Planners
SunBridge
is the national leader in 3-GEN Planning.
Our mission is to guide professional advisors through the process of
becoming SunBridge 3-GEN Planners. We
understand what’s required to step up and take charge of one’s professional
development.
SunBridge
is uniquely qualified to help professional planners and advisors add this
exclusive planning methodology to their professional service offering. Members of the SunBridge Network experience
our powerful and time-tested “TRAINING – TOOLS – SUPPORT” approach to equipping
professionals for this amazing journey of becoming a SunBridge 3-GEN Planner.
Since
1999, we’ve been showing professional advisors how to address the WHOLENESS of
their clients’ wealth, not just their money.
We provide SunBridge Network members with a wide array of resources,
including our latest graphic and conceptual image, “The Thriving 3-GEN
Family.” This exclusive proprietary tool
will help you, your clients, and your colleagues “get” what 3-GEN Planning is
all about.
It’s
our job to help advisors shift their thinking and their perspective to achieve
the new mind-set they will need to
succeed in this important work. We help
them develop additional capabilities so they will have the new skill-set required to operate effectively in this broader
role. We equip them with a new tool-set to make their work more efficient and profitable. And we provide them a new support-set so they can make this transformation stick for the
long haul.
The
process of becoming a SunBridge 3-GEN Planner is a joyful, meaningful journey,
perhaps more so than anything else in your prior work experience. Using “The Thriving 3-GEN Family” planning model,
the twin dangers of the loss of family wealth and solidarity within three
generations and the loss of the advisor’s business at the death of the client
can be effectively addressed and avoided.
F. Imagine Yourself as a SunBridge 3-GEN Planner
Can
you picture what it would be like to practice this way? See if you can visualize
yourself in settings such as these:
As
a SunBridge 3-GEN Planner, you teach a teenage grandchild how to conduct a
“Priceless Conversation” interview with his or her grandparent, then listen in
the wings as it actually happens.
Imagine witnessing a grandchild’s delight in uncovering his
grandparent’s stories and a grandparent’s pride in sharing his life’s wisdom.
As
a SunBridge 3-GEN Planner, you lead an “Angels & Heroes” activity for the
entire multigenerational family. During
the exercise, each person’s honest and authentic value system is discovered, shared,
and appreciated. Imagine the impact of
carefully weaving this insight into the family’s 3-GEN plan.
As
a SunBridge 3-GEN Planner, you guide a three-generation client family through a
real-life philanthropic adventure using the “Main Street Giving Experience.” This hands-on activity draws the family
together and changes the lives of everyone involved. Imagine them discovering what makes each one
come alive and recognizing their power to make a difference in their
communities.
As
a SunBridge 3-GEN Planner, you facilitate a “Time to Think Council” in which
the family’s knottiest issues are artfully and lovingly dissected and resolved,
to the amazement and satisfaction of all.
Picture a family learning — perhaps for the first time — how to talk to
each other about difficult subjects without it turning into a shouting match.
As
a SunBridge 3-GEN Planner, you make sure that a large bequest from a parent or
grandparent is not a “Sudden
Money” event, because you prepare the children and grandchildren to receive
it long in advance.
As
a SunBridge 3-GEN Planner, you don’t let your clients make “The Ultimate Gift” mistake of waiting
until they’re dead, then counting on others (or their documents, or even a DVD)
to fix their family. As a SunBridge
3-GEN Planner, you understand that “it
is better to build a fence at the top of the cliff than it is to station an ambulance
at the bottom.” Harold B. Lee
As
a SunBridge 3-GEN Planner, you get paid for connecting families and changing
lives. Your work is richly rewarding, in
every sense of the word.
G. An Invitation
If
you’ve always dreamed of practicing this way, or if you can at least imagine
yourself working this way with select clients, I invite you to become a member
of the SunBridge Network and learn to become a SunBridge 3-GEN Planner.
Your
journey will begin with a free introductory webinar “The Case for 3-GEN Planning”
on Wednesday, February 12, 2014, at Noon Eastern. That will be followed by monthly SunBridge
Network training conference calls on the fourth Wednesday at Noon Eastern.
We
are offering two 2-day workshops this spring and summer that will kick your
training into high gear:
“The
Main Street Giving Experience for Facilitators and Ambassadors,” Thursday and Friday, April 3-4, 2014, in Orlando,
Florida
“The
SunBridge 3-GEN Planning Retreat,” Thursday
and Friday, June 26-27, 2014, in Orlando, Florida.
If
you’re ready to step up your game, we’re ready to support you every step of the
way. Don’t you owe it to yourself and to
your clients and their families, for generations to come?
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