Key services

• Advice and support for significant family matters
• Restructuring legal financial entities
• Succession planning
• Tax guidance

Background
Inheritances are complicated matters in any context. Typically, inheriting family wealth is thought of as something that happens after a person’s death. However, many families choose to transfer wealth to their children while they are still alive. Their reasons could be a desire to help their children financially while they are still young and the ability to see how the inheritance is used. This was the case with a wealthy family who approached us. They wanted their children to benefit from the family’s wealth while the parents were still alive.

The challenges
Distributing family wealth is as much an emotional challenge as a financial arrangement. For example, children who inherit wealth often feel obligated to their parents about how that money is used. Will they really have independence? It is vital for families to have honest conversations about their expectations and values around inheritance. On the financial side, if not done correctly, this arrangement can result in significant tax liabilities.

The solution
Our first step was listening. We met with the family collectively and individually. We identified the various branches of the family to understand their needs and desires. We discovered through this process that each branch of the family needed to be in control of their future. Despite the family wealth being concentrated in a couple of entities with joint control, we could unbundle the family wealth so that each branch had control over entities to hold their wealth.

Yes, this cost the family tax to unbundle; however, it gave each family branch their independence and ability to make their own financial decisions based on their needs. As a result, they became a better functioning family and used their Foundation to work together to continue and share the family values.