The common man often fails to understand the effects of extreme wealth on children. These children are at an advantage, but at what cost? The way a family values, gives, and educates their children on the wealth they possess, greatly impacts the lives of the children. Given the large amount of wealth, it is easy for impressionable young children to feel entitled and lose their motivation.
A variety of outcomes are possible, Blair Trippe, a strategic analyst, has identified that certain approaches to wealth lead to certain outcomes. To bring forth her understanding on the ways in which families transfer their wealth, Blair has created a framework on wealth transfer strategies.
“If progenitors can understand the issues at play and how choices regarding transfer of their wealth may impact the recipients of that wealth, they will be better able to achieve the benefits they want for their next-gens and avoid some of the pitfalls they fear.
“Different motivations, assumptions and goals lead to different types of family wealth transfer strategies. By deconstructing the components of wealth transfer, parents can make more informed decisions regarding their wealth transfer strategies. The framework helps parents recognize that what they do to transfer wealth and how they do it has a significant impact on their children. Rather than just hoping for the best, parents can consider where they are in the matrix and design a path to get to where they want to be. Progenitors can be proactive regarding how they transfer their assets over time without falling into the trap of entitling (or controlling) the recipients of their wealth.
“Through being more intentional about what and how they give, parents can avoid unintentionally using wealth as a means to control and infantilize or in a way that breeds entitlement. Instead, they can make wealth transfer empowering to their heirs. More importantly, when parents and heirs discuss wealth transfer within the context of this framework, the options for wealth transfer and their potential outcomes become clearer and more meaningful.
“With greater understanding, productive conversation can happen on these important topics, and the legacy has a greater likelihood of inspiring pursuit of purpose and being a force for good, as was intended.”
The Progenitor's Dilemma: Avoiding Entitlement When Transferring Wealth
by Doug Baumoel, Blair Trippe and Katie SpencerWealth can, at times, feel more like a curse than a blessing. Wealth…
Expert in family enterprise - Don't confuse motion with progress - Blair Trippe