Navigating the crossroads of family and finance
By John Hughes
Senior Vice President, Private Enterprise
Jim Rea
Partner, Private Enterprise
Wealth creates options. Options create complexity. Learn how you can build a strong family unit and ensure family harmony by adopting a focused approach to family finance management.
[insights]
- Harmony is achieved through directed, purposeful efforts. You need to take an active management approach to keeping your family in step.
- Intergenerational business transfer rules are complex and dynamic. Your plan may need updating as legislation changes.
- Early planning can identify pitfalls ahead of time and help you build a plan to overcome any issues.
Family can overlap with wealth in complex ways, particularly if you’re an entrepreneur or family business owner. You must consider the nuances of how tax, inherited wealth, estate planning and business succession will impact your family now and in the future.
In this rendition of the Business Owner Series webinar, professionals from our Family Office will discuss topics such as intergenerational business transfer rules, personal and business financial planning and family governance.
You need the right expertise to untangle the issues of family, wealth and business. This webinar is the place to start.
Key takeaways
Use the three-circle model
The three-circle model is a well-established lens to use when examining your situation. An individual’s position in the three circles will influence their views, goals, expectations and family dynamics — all of which can cause conflicts within the family enterprise.
You can use the model to identify where different family members fall and uncover the risks and opportunities that come with different positions.
Read more about the three-circle model and questions to ask in this article.
Think about your financial plan early
Some business owners see their financial success and believe they’ll be set for retirement. But a financial plan delivers more than just an understanding of the numbers — it helps you think about what you want to do in your next chapter and start to take the steps to turn that into reality.
Building a financial plan well before you think you’ll need it can help you set priorities and understand what the costs will be. From there, you can make educated decisions and feel confident that you’re heading in the right direction.
A strong financial plan will include details about insurance and risk management, investments, retirement, tax planning and estate planning.
Embrace family governance
Behind strong families is a strong governance system. Conflict and difficult decisions are inevitable when dealing with the needs of multiple people who all have unique perspectives on what should happen.
With strong governance, your family has a way of navigating conflict and achieving resolutions. Governance can help you develop family vision, values and goals, educate the next generation and create policies for making decisions.
Read our article to learn how to create strong family governance.