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Sustaining True Wealth Over Multiple Generations

October 11, 2017 by Avi Kantor

According to the Family Business Institute…only 30% of family businesses survive into the second generation and 12% into the third. A mere 3% make it into the fourth and beyond

Many sources cite similar statistics, pointing to an extraordinarily high worldwide failure rate in wealth transitions (generally defined as wealth remaining under the control of the beneficiaries). This begs the question, “Why does this happen?” One of the pioneering thinkers on this issue, attorney, James E. Hughes, Jr., focused on the lack of structure and governance in families. The article below suggests that lack of inter-generational communication and collaboration have been the primary causes of wealth dissipating over three generations.

CNN Money Article: Squandering the Family Fortune…Why Rich Families Are Losing Their Money

Consider the many advisors that families employ. There are attorneys, accountants, consultants, psychologists, life coaches, and various financial advisors from wealth managers, to insurance agents, to financial and estate planners all of whom, presumably in good faith, attempt to help their client families protect, preserve, grow, and sustain their wealth for multiple generations. Despite the collective best efforts of all of these professionals, their net effectiveness has been no more than 10% over three generations. What if Apple sold you a product that failed 90% of the time? Would you buy it? Yet, that’s in effect what families are doing when they continue to use traditional methods to plan for their families’ futures..

We cannot solve problems with same level of thinking that created them

– Albert Einstein

Thinking at a new, different level about the challenges of transitioning wealth, does not mean that the best work of attorneys, accountants, and other professionals isn’t necessary. Families need governance guided by the work of skilled attorneys. They need excellent tax and estate planning, wealth management, business consulting, work on family dynamics, and life coaching. Families need teams of professional service providers. Yet, how might these teams of professionals do things differently, more effectively?

By now, many of you know that we’ve adopted a mindset of Gratitude, “True Wealth”, and Leadership as core beliefs to address the “shirtsleeves to shirtsleeves in 3 generations” issue. It has been our experience that families must accept an attitude and a disciplined practice of Stewardship if we’re to sustain True Wealth over multiple generations. Our roles as advisors are to support our client families in this Stewardship undertaking. In other words, it’s to collaborate with our clients and each other in an endeavor that has historically challenged even the most intentional families. I will elaborate further on this topic of “collaboration” in future newsletters.

Avi Kantor

It’s About True Wealth, not Just Money…and Why “Collaboration” is More Than a Buzzword

September 1, 2017 by Avi Kantor

I’ve been thinking a lot about how we as professionals can provide more timely and relevant services to more people. Personally, I know that I don’t have all of the answers and solutions to everyone’s problems or opportunities. But I do know that in our area of True Wealth stewardship services and Wyoming’s unique advantages, we have much to offer.

Then I came across the following article from Forbes. The article describes a typical approach that I’ve seen for years: advisors focus on minimizing taxes, maximizing returns, and mitigating risk through legal and insurance strategies. As the article suggests, most advisors believe they should communicate with other advisors. But here’s the challenge that I see: they’re communicating in order to save the maximum amount in taxes, seize investment opportunities, and address financial risks ONLY. To me, this perspective, while common, is short-sighted, self-serving, and misses the mark when it comes to what people really want and need.

Forbes Article “Why Your Financial Planner, Lawyer, and Accountant Should Talk”

I am far from a legal or tax expert. But I can say one thing: advisors would be well-served to ask their clients what they value more than money. In so doing, they may discover that their clients have values, concerns, aspirations, and unfulfilled dreams that saving taxes, maximizing returns, or mitigating financial risks don’t address.

Recently, I attended the The Society of Trust and Estate Practitioners (STEP) Conference here in Jackson. STEP is a large international organization focused on the trust and estate planning issues of families from all over the world who have significant financial wealth. Here again, my sense is that most of the advisors in attendance concentrate on minimizing taxes, maximizing returns, and mitigating risk through legal and insurance strategies. They generally are not thinking about what really matters most to their clients.

I also noticed while attending the STEP conference that collaboration is the new industry buzz word. Just as in the Forbes article above, most advisors seem to view collaboration as talking to each other, cooperating amiably with each other, or being agreeable and tolerant with each other.

I would juxtapose this “business as usual” approach with Avi Kantor’s panel presentation at the recent Empowered Wealth Summit.

Avi knows that if we truly collaborate with our professional colleagues and hold each other accountable for serving our client families well, we can provide more timely and relevant services than what the world has experienced historically.

Gratitude, True Wealth, and The Total Eclipse of 2017

August 27, 2017 by Avi Kantor

I missed the Total Eclipse.

On August 21st, I was with our extended family at an annual family event on the outer banks of North Carolina. Where we were, even though the sun was 90% obscured by the moon, the changes in the environment were barely perceptible. Yes, it was “cool” and “awesome”, but it didn’t have much of an effect on our day.

However, we had guests at our home in Jackson who reported that the total eclipse was a “once in a lifetime experience”; one like no other. I pondered what they meant by this and surmised that it had something to do with becoming aware that life on Earth depends upon the energy from the Sun; that our very existence is fragile, and that we benefit from a rare combination of cosmic circumstances that sustain life as we know it. The total eclipse must have heightened that awareness.

I’m reminded of the late Carl Sagan’s “Pale Blue Dot” monologue, in which he describes his response to the visual images of the Earth sent from the Voyager 1 spacecraft as it passed Saturn in 1990. He called the Earth the “Pale Blue Dot” because it was so small and insignificant as seen from Voyager 1. Here’s an excerpt from Sagan’s monologue:

“Look again at that dot. That’s here. That’s home. That’s us. On it everyone you love, everyone you know, everyone you ever heard of, every human being who ever was, lived out their lives. The aggregate of our joy and suffering, thousands of confident religions, ideologies, and economic doctrines, every hunter and forager, every hero and coward, every creator and destroyer of civilization, every king and peasant, every young couple in love, every mother and father, hopeful child, inventor and explorer, every teacher of morals, every corrupt politician, every “superstar,” every “supreme leader,” every saint and sinner in the history of our species lived there-on a mote of dust suspended in a sunbeam.”

That’s what I suspect was on the minds of our house guests during and after the eclipse.

There’s a part of me that wishes I could have experienced the Total Eclipse in Jackson. Yet, I know in my heart that I was where I was supposed to be: with my family, building on our traditions, and creating stories that will sustain us and connect us over time. It’s our family’s True Wealth.

When we appreciate the opportunities we have to be with our family and friends, to engage in meaningful and fulfilling activities, and to contribute to the well-being of others and our community, our lives become richer. We experience True Wealth, not just numbers on financial statements or account balances.

Avi Kantor

Cookout and Conversation

August 4, 2017 by Avi Kantor

On Sunday, July 23rd, we hosted an informal barbeque at the home of David Cedenhead in Jackson.

The Certior Group will continue to conduct regular social events and workshops.. Please contact our office for further details and please check this newsletter for announcements of future events.

Too Busy to Do What Matters Most

July 4, 2017 by Avi Kantor

Marshall Goldsmith, a highly sought-after executive coach, has written books and articles around the idea that “what got you here, won’t get you there”. In other words, the methods, habits, ideas, etc. that in many instances have led to business and personal success, aren’t necessarily the path to greater success and especially greater happiness, fulfillment, and meaning in life. One of the major obstacles to further progress for many of the people we meet at the Certior Group is our busy lives.

It’s when we’re too busy that we can sometimes lose sight of what matters most. We can spend our time being busy, “putting out fires”, or falling back into habitual patterns of behavior. This is where I’ve found the Empowered Wealth Mindset to be most beneficial. And it begins with Gratitude.

We teach that Gratitude is the optimal response to life’s negative events, to those events and circumstances that aren’t adding to our happiness, fulfillment, or greater meaning. Seth Godin shares a story that highlights how Gratitude can transform the frustrations and anxiety of daily life into a better way of being:

I live fourteen miles from ground zero (the site of the 9-11 disaster in New York City), and there used be a cafe about five miles from here, near the train station. For a long time, there was a handwritten letter on the bulletin board in the café. It said “I was here a few weeks ago and I ordered a decaf coffee with bagel and butter. The idiot behind the counter gave me regular coffee, and put cream cheese on my bagel. As a result, I got all frustrated, and as a result he had to make it again, and as a result I was kicking and screaming, and as a result I missed my train, and because I missed my train, I got to the World Trade Center thirty minutes after the plane crashed into it and I am alive today. Thank you to the person who messed up my coffee order.”

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