Conflict, whether in families, businesses or nations, results from unmet expectations. As we’ve learned, money is not passive. It's presence will cause people to begin thinking of how to use it and in the process, form their own expectations. When these expectations are not met, or appear they will not be met, conflict will surface. The key to avoiding conflict is to help our children align their expectations with reality, but this takes communication and for some reason, talking about money is off-limits.
Why We Don’t Talk About Money
1. Did our parents talk about money with us? Not likely, so it is not likely we will naturally talk about it with our children either.
2. Fear of hurting our children. This is a natural concern. We think if the kids know they are getting a significant inheritance, it will rob them of a work ethic. Our unspoken hope, is if nothing is said, they will work and develop themselves as if it were certain there would be no inheritance and then when it comes, there will be no downside.
3. Often we are too busy to make it a priority. “We’ll talk to them someday”, but someday never arrives.
Just as unmet expectations are a source of conflict, good communication is the key to harmony.
A Powerful Paradigm
What if rather than viewing an inheritance as simply leaving assets to our children, we view it as transferring a stewardship responsibility and opportunity to the next generation? Our children take over (to some extent) the stewardship of the wealth, it is a God-given calling. In this paradigm, it is natural that wealth training is required. This context also motivates the child to develop themselves and foster ambition – they have an important role to play and it goes beyond themselves. Open discussions with them will lead to these 4 outcomes:
1. Help them recognize their important role and their need to reach their potential.
2. Help them seek to optimize the use of family wealth.
3. Allow us the opportunity to build a family legacy of people and wealth which goes beyond our generation.
4. Deepen family relationships; both generations grow in interdependence, needing each other and not just what the other has.
Open communication aligns expectations with reality, reduces conflict, positions our children for a much greater role than a “beneficiary” and deepens family relationships. Passing on healthy relationships is far more valuable and a much greater legacy than passing on a healthy investment portfolio.
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Covenant Family Wealth Advisors' certified financial advisors and business succession planning experts help guide families through the technical and emotional aspects of managing wealth, estate planning and business succession. Our experienced financial management team uses a Christian perspective that is rarely found in traditional financial planning, and we work closely with you to develop a personal Holistic Stewardship Plan that encompasses financial planning, estate planning, family business transition and philanthropy.