Once in a while, we all have these brief moments of silent appreciation, moments when you take a slow, deep breath, take in everything you have around you and smile—a moment where the past, present, and future feel connected. I had one of these moments the other day.
With it being in the heart of spring in the greater Boston area and the weather particularly lovely on the North Shore, my wife and I decided to take the kids to one of our favorite, family-friendly restaurants on Plum Island in Newbury, the Plum Island Grille. It’s one of those charming seaside spots where the kids can have fun, and my wife and I can relax. It’s the place that brings me back to my childhood and dining out with my parents in the warmer months of the year. The smell of fried clams, french fries, burgers, and draft lagers fills the air, filling my head with countless memories.
During our visit, I had one of those reflective appreciation moments as I watched my boys and infant daughter enjoy the sunshine (not to mention rootbeer floats). I realized how I was passing down traditions and values that were passed down to me; I had a great sense of paternal pride. I wasn’t just thinking about the immediate moment but the past behind me and the generations to come down the road, and this inspired me to write this piece and talk about family financial planning for generations.
Family Financial Planning – The Entire Tree
Perspective is everything. It’s funny; when most people think about any professional involved with financial planning, Boston wealth strategies, or accounting, they envision lots of number-crunching. While there is certainly that, I consider myself someone whose job is primarily to provide perspective. Without a clear perspective, there’s no reason to craft a financial plan; it would be directionless. I work to provide my clients with a clear perspective on their financial pasts and potential futures.
A common viewpoint I often have to correct is that financial planning only extends to ourselves and our immediate family, which is mostly untrue. Financial planning extends throughout the entire family tree—past, present, and future.
Family Financial Planning for Generations
If it seems a bit dramatic or overwhelming to consider the implications of multi-generational financial planning, I encourage you to start slow and carefully consider the following points:
* Do You Understand Your Family’s Financial History to Best Plan for the Future?
It’s amazing what can be uncovered with some investigation. There can be tremendous opportunities/blessings unveiled by painting a complete picture of what to expect from the family regarding finances. For instance, do you know what you’ll be inheriting? Do you know if they’ll be impending debts? Are you prepared for the tax implications of all types of inheritances?
While the conversations may not be the easiest to initiate, it’s so important to have clear communication with all family members and parties involved to best plan for the future and not be met with big hurdles and challenges. Working out all these matters is a significant part of my job as a family financial planner; it’s not just about the immediate family. Planning for the entire family tree ensures healthier roots for all.
Open discussions are necessary for opportunities to be noticed and acted upon. I understand that all family circumstances are different, and sometimes not everyone is on the best terms. But holding on to past transgressions and remaining private/siloed from one another is not a way to plan for a future that works for all. Honesty and transparency are necessary for generational financial planning.
Having an intermediary figure to clarify where things stand and where they are going is necessary for families who may have a disconnect or just need to be caught up to be on the same page. I have various resources and systems to “reconstruct the family tree,” start the dialogue across all parties involved, and get the meetings on the books, regardless of where communication last ended. I’m always happy to moderate whenever it’s appropriate.
* Live-on vs. Leave-on Assets
Think about the next ten years of your life; what do you want to accomplish? The answers here will vary greatly, depending on age and financial circumstances, but it’s a good place to start.
Ok, now that you’ve got an idea of what the next ten years will ideally look like, can you picture what the next twenty years will look like? Are you just starting a family and looking to buy a home, or are you in retirement and looking to spend more time with your family and grandchildren?
Do you know how much you’ll need to support yourself, meet your goals, and what you’ll be leaving behind for loved ones? Would you rather take the family on vacations now? Or leave them something when you’re gone?
Many of my clients lived ingrained with the notion that they need to save as much money as possible throughout their lives, but when it comes to the twilight years, they have no idea how to enjoy it or what they’ve saved for. These questions are best addressed before the options/opportunities expire; this is where I come in, providing perspective for the entire family tree.
Family Financial Planning for Generations
While my afternoon at Plum Island Grille was a wonderful, albeit shorter, moment in time in the picture, it gave me some perspective that I work to provide my clients. We can learn a lot from the past, and best plan for the future, without sacrificing time in the present; it just takes a little guidance.
Please reach out if you’d like to discuss your family tree and future financial goals; I’d be delighted to hear your story.
