True Wealth Archives - The Certior Group

Dr. Barnes and Scenario Planning

June 9, 2020 by Avi Kantor

Dr. Albert Barnes, a Philadelphia physician and chemist, amassed one of the world’s greatest art collections. He established The Barnes Foundation to own and display his art according to his very specific, highly idiosyncratic wishes. The Foundation was designed to function as an educational institution to teach Dr. Barnes’ principles of art. When Dr. Barnes died in a tragic car accident in 1951, The Barnes Foundation was to have continued as an art teaching institution in perpetuity. However, subsequent events undermined Dr. Barnes’ intent. Powerful monied and political interests in Philadelphia and the state of Pennsylvania, perhaps mismanagement, and inflexible trust provisions combined to shift the fate of the art collection away from Dr. Barnes’ vision. The Barnes Foundation art collection is now housed in downtown Philadelphia adjacent to the Philadelphia Museum of Art. This fact would undoubtedly have upset Dr. Barnes who publicly expressed his disdain for that institution. [1]

The former Barnes Foundation in Merion (left), The new Barnes Foundation in Philadelphia (right)

In many ways Dr. Barnes’ estate planning represented perhaps the best possible planning available at that time. Yet, despite his planning efforts and the substantial endowment that The Barnes Foundation had at the time of his death, the Foundation ultimately was not able to carry out and sustain his wishes. What went wrong? What might we learn from Dr. Barnes and The Barnes Foundation story that might help us think and plan in volatile, uncertain, and complex times?

One approach that might have helped Dr. Barnes is scenario planning. This entails a rigorous process of imaging an ideal future vision, then imaging potential scenarios that might disrupt his vision, and crafting contingency plans to avoid or address obstacles that might undermine achieving the ideal future vision. Contemporary scenario planning has been influenced by the work of Shell Oil Company. [2]

Imaging the world after the collapse of the Soviet Union, in the 1970’s Shell assembled a diverse group of thinkers, domain specialists, as well as generalists in business and management. Together, they developed a process that has since shaped much of Shell’s decision making and strategic planning. Over time, their methods have also influenced military, business, and government decision makers. Investment professionals, statisticians, and even poker players use scenario planning techniques to deal with uncertainty and multiple variables outside of one’s control.

Theatrical release poster by Neil Kellerhouse and Erik Buckham

What if Dr. Barnes had imagined circumstances in which his collection was running short of money? What if he had imagined a situation where his trustees had ulterior, selfish motives? What if he had anticipated that the art world and the City of Philadelphia would change its opinion about his collection and covet the collection? All of these things subsequently happened….and the foundation was ultimately unable to adequately deal with them. Perhaps, with the benefit of scenario planning, Dr. Barnes might have supplemented his planning documents in a way that might have given the Foundation greater flexibility and more options to sustain itself according to his deepest desires and wishes.

In many ways scenario planning is more akin to writing a novel or a piece of science fiction than it is a branch of traditional financial and estate planning. The process calls for a great deal of imagination and for a deep understanding of human behavior, human motives (both good and bad), and what is possible in a world that’s rapidly changing. It is essentially an artistic endeavor. It is also well-suited for today’s COVID-19 environment.

At a time when predictions – whether it’s regarding Covid-19, economic, political, social, psychological, or cultural impacts – can’t be based on reliable extrapolations from the past or verifiable factual information, scenario planning holds the potential for us to think, plan, and make decisions in a very uncertain environment. I believe this capability will help our clients steward their families and their True Wealth during these challenging times.

[1] “The Art of the Steal”, a documentary film by Don Argott, 2009.

[2] Shell Scenarios, https://www.shell.com/energy-and-innovation/the-energy-future/scenarios.html

Time is Money

May 23, 2020 by Avi Kantor

We’ve all heard the phrase “Time is Money”. This metaphor permeates much of our language and thinking about time. Many of our household and personal gadgets are “time-saving devices”. Sometimes we judge the depth of our commitments and efforts by assessing the “time we have invested”. When someone is struggling with a serious health condition, we say that they’re “living on borrowed time”.

You are the average of the five people you spend the most time with.

-Jim Rohn

How we “spend”, “budget”, “leverage”, and “invest” our time are all abstract notions derived from the basic idea that “Time is Money”. So, time has value. But unlike money, we don’t all agree on what that value is. Furthermore, the way we actually use our time belies what we say it means to us.

One of the consequences of our Covid-19 experiences is that we’ve all had our schedules and daily routines disrupted. We’ve had to adjust and use our time differently.

Tell me what you value and I might believe you; but show me your calendar and your bank statement, and I’ll show you what you really value.

-Peter Drucker

If we value our time, how do we actually “spend” it? For some, Covid-19 has created opportunities for more quality time with family members; time spent home-schooling kids, cooking and eating meals together; watching movies, playing board games, and going for walks and hikes. For others, this period of time has been anxiety-producing, leading to negative thoughts, unproductive behavior, and time-wasting.

Habits and fixed behavior patterns; fear of change, fear of the unknown, fear of failure, fear in general; and human laziness are common underlying reasons why we waste time. Former Navy Seal, now author and podcaster Jocko Willink says that “discipline is freedom.” What he means by this is that the discipline to build and maintain skillful practices allow us to better learn, grow, achieve, and help others. In our work, “The Path to Mastery” begins with positive, intentionally-designed daily routines and habits. How might you utilize this Covid-19 era to rethink your routines and habits to better serve yourself and your family? How might you rewire to better optimize your True Wealth?

Crisis Creates an Opportunity to Focus on What Matters Most

March 20, 2020 by Avi Kantor

“Everything can be taken from a man but one thing: the last of the human freedoms—to choose one’s attitude in any given set of circumstances, to choose one’s own way.” -Viktor Frankl, Holocaust Survivor

A global pandemic. Panic buying of supplies. Stocks declining steeply. Schools and businesses closing. Cities under lockdown.

All of our lives have been disrupted.

Under these conditions, psychologists and neuroscientists understand and expect that many people will experience fear, anxiety, and an inability to focus and think clearly. They call this the “amygdala hijack”, singling out the emotional part of the brain – the amygdala – that triggers our primitive “fight or flight” response to perceived danger. With the whole world triggered by unprecedented events – events that could potentially spiral even further into uncharted territory – how might we keep from being amygdala hijacked? How might we remain calm, centered, and focused?

Of course, there are intoxicants of all forms and escapism that can temporarily distract our minds from current events. But keep us calm, centered, and focused? Probably not. Many have turned to mindfulness meditation, yoga, exercise, and other forms of relaxation. I’m an advocate of many of these disciplines. Our work, though, suggests that there’s another option.

"I am grateful for" written in a notebook with a pen.

Over the years, we’ve been very intentional about practicing Gratitude. Our experience has been that Gratitude has helped us, our family members, our colleagues, and clients appreciate the many blessings we all have and find the good in even the most challenging situations. This practice has never been more relevant and necessary for our collective wellbeing.

Through the lens of Gratitude, we have an opportunity to refocus our minds on what’s essential for our wellbeing; that which brings us happiness, fulfillment, meaning, and joy. We call this True Wealth. But regardless of what one calls it, there are enduring parts of our lives that persist despite the coronavirus, the stock market, and the disruption that’s affected us all. For most of us, this includes our family, our continued good health (if we’re currently blessed with good health), our Faith, the many diverse experiences we’ve had and continue to have, and the joy of contributing to the wellbeing of others.

Holocaust survivor Viktor Frankl said, “Everything can be taken from a man but one thing: the last of the human freedoms—to choose one’s attitude in any given set of circumstances, to choose one’s own way.” Now is our time to choose…to choose Gratitude and True Wealth…and to help others do the same.

Striving Together: The Intersection of Competition and Collaboration

September 7, 2019 by Avi Kantor

“…in jazz we share, we listen to each other, we respect each other, we are creating in the moment…”¹ – Herbie Hancock, Grammy award winning jazz musician

At first glance, competition and collaboration seem diametrically opposed. Competition conjures up images of winning and losing; triumph and failure. Collaboration suggests camaraderie, working side-by-side. If we’re competitors, we’re not collaborating; if we’re collaborating, we’re not competing.

But did you know that “compete” originally meant “to strive together?” It’s true. The word “compete” was originally derived from the Latin root “com” which means “with, and “petere” which means “to strive, seek, fall upon, rush at, attack”. In Late Latin “competere” came to mean “strive in common, strive after something in company with or together”². Doesn’t that sound a lot like “collaboration?”

It turns out that as the French adopted and used the word in the Middle Ages, “compete” gradually took on the meaning “to enter or be put into rivalry with.”³ Today, it seems that there’s “friendly” competition – as in some sports or business situations – and “cutthroat competition” for scarce resources, opportunities, and “winning” in sports, business, and many other situations in life.

“I’m a fighter. That’s my culture…The longer I own this team, they’re gonna pick up more of my culture. We had ’em. We should have stepped on their throats the other night and cut their throats.” – Tilman Fertitta, owner of the Houston Rockets NBA basketball team, commenting after being eliminated in the recent NBA playoffs. ⁴

Rather than cutthroat competition, The Certior Group embraces the original notion of competing; that is, “to strive together” with our co-collaborators and clients to optimize wealth and wellbeing. In fact, we’ve identified collaboration as one of our core values. For us, collaboration isn’t just a nice sounding word that goes on our website and into our company literature. Collaboration is fundamental to the work that we do. Without collaboration, we can’t do the work and provide the value that we promise our stakeholders. Rather than relying solely on our own internal domain expertise, – which we certainly have in several areas – we’re invested in a process that combines not only our own expertise but also that of others. It is our belief that by striving together with other professionals, like well-performed jazz, we can best serve our clients, collaborators, and team members.

(1) Brainyquote.com/quotes/herbie_hancock_592363

(2) Origin and etymology of compete, Online Etymology Dictionary, etymonline.com

(3) Ibid.

(4) Rockets owner goes on epic rant after Warriors’ clinching Game 6, Ali Thanawalla, NBCsports.com

Sustaining Multi-Generational Wealth

July 7, 2019 by Avi Kantor

Garrett Gunderson recently published a provocative article on Forbes.com entitled “How The Ultra-Rich Never Die.”

https://www.forbes.com/sites/garrettgunderson/2019/06/15/how-the-ultra-rich-never-die/

The article’s premise is to invest in future heirs not in traditional investments. What Gunderson means by “invest” is to dedicate time, energy, attention, and resources towards developing the “talents, interests, abilities, and skill sets of those we choose to be the ones who will carry on and benefit from our legacy.” Gunderson’s rationale is that even if these heirs do not grow their inherited financial assets, life insurance can replenish those assets, freeing the heirs to grow as people and contribute to the world. He also touches on core values, traditions, rituals, family retreats, and mission statements. His concluding remark is “invest in people, not products.”

I applaud his focus on people. Traditional multi-generational planning has tended to emphasize legal structures and financial strategies, often to the detriment of the people involved.

Yet, Gunderson’s either/or thinking – that one should “invest” in people, not products – strikes me as somewhat misleading. Shouldn’t it be people AND investments? Without informed wealth management, focusing exclusively on people can become a prescription for undisciplined self-indulgence and waste. True Wealth involves optimizing financial assets to support people and their quest for happiness, joy, fulfillment, and meaning.

“We ultimately ‘live our legacies.’ That is, if we live our lives with high moral and ethical character, we positively influence those around us and the culture of our families. A family culture of high moral and ethical character ultimately will determine if the assets ‘never die.'”

When I look at the challenges of multi-generational True Wealth, I see the opportunity to help family members align around a larger common vision and purpose. In my experience, this means developing leadership character and family culture. As Gunderson suggests, expressing core values, traditions, rituals, retreats, and mission statements are important and necessary. However, these tend to be about external behaviors. I see character and culture as largely internal and about mindset. And I believe that mindset matters.

Finally, when Gunderson says the “Ultra-Rich Never Die”, he means that the assets of the “Ultra-Rich” wealth creators won’t “die” if his or her heirs are well-versed in core values, traditions, rituals, retreats, and mission statements…and buy life insurance. This can be a great overall strategy for some families. In fact, many multi-generational families successfully employ this strategy. I would add that we ultimately “live our legacies.” That is, if we live our lives with high moral and ethical character, we positively influence those around us and the culture of our families. A family culture of high moral and ethical character ultimately will determine if the assets “never die.”

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