Having an open dialogue about family wealth and future plans for that wealth can help contribute to a lasting legacy.
Head of The Private Bank and Wells Fargo Partnerships
There’s truly nothing like getting away, unplugging, and spending quality time with the ones you love on vacation.
I began my summer with a family trip to Greece to celebrate our children’s high school and college graduations. Beautiful sites. The sea. The food! I feel very fortunate that our kids still enjoy exploring new cultures and going on adventures with Mom and Dad.
They’re at an age when pivotal conversations about finances, saving, and planning are a must, but the truth is that all families — no matter the ages of the generations involved — benefit from open dialogue about family wealth and future plans for that wealth. Why not take advantage of a family vacation to initiate the conversation?
Even though it can be uncomfortable, I always encourage clients to embrace conversations about wealth with family members. I believe it is important to start educating our younger generations at an early age and build on that education over time. While vacationing with your family — whether you’re relaxing somewhere tropical or touring historic sites — being away from the day-to-day stress of your normal life presents a great opportunity to introduce money discussions in a relaxed environment.
If you have children or young adults in your family, you even could teach them a valuable budgeting lesson by giving them vacation destination options and a budget and then allow them to choose where they would like to go and what activities they would like to do while staying within the budget. Also, engaging in philanthropic activities while on vacation is a great way to contribute to local communities and instill a sense of gratitude in addition to cultural connection.
Plan ahead
If you’re going on a trip, you likely have an itinerary, reservations, and a plan. Consider also planning your conversation about your family’s wealth. You don’t need a formal agenda by any means, but an outline of the topics you would like to cover would be helpful in guiding the conversation. Do you want to talk about investing, managing budgets, or philanthropy plans? Think about some key points you would like to discuss, but remember that this should be an ongoing discussion, so you don’t need cover all grounds at once.
Be sure to communicate with your family in advance that you would like to set aside some time during vacation to have this conversation. That will prevent them from feeling as though they’ve been taken off guard, and it will also give them the chance to think of any questions they would like to ask you.
Lead with questions
It’s a great idea to have an outline, but try to avoid turning the conversation into a lecture. In my experience, some of the best family meetings about wealth are ones in which everyone involved in an active participant.
Consider starting the conversation with open-ended questions rather than statements. Are there things about our family’s wealth that you’re curious about? How do your values impact how you plan to manage money? Do you feel confident in your own financial literacy, or do you want to learn more? Are there philanthropic causes you would like to support? What are your financial goals, and how can we help you accomplish those goals?
Make it fun
Money talk doesn’t have to be dry and boring. You’re on vacation after all! Think about ways to engage each generation participating in the conversation. It could be as simple as asking each person to share their best and worst financial decisions to reveal money lessons and values. Or, if you think your family can handle a friendly competition without hurt feelings, issue a challenge. Perhaps give each young person a modest amount of money to invest and challenge them to meet a certain goal by your next family vacation. If your family is considering philanthropic efforts, ask the next generation to research a charity that interests them and present a proposal to the entire family so that you can discuss it together.
Building understanding and transparency around money lessons and your family’s wealth plan is critical not only for next generations’ financial stability but also for relationships among your family. In the process, you can make memories that last a lifetime.
