One would assume that most wealthy people have an estate plan in place, detailing how money and other assets should be distributed to succeeding generations. In addition, these plans will often include how any business operations should be handled.
The estate plans themselves are mostly solid. However, as cited in Denver Postarticletitled "About to inherit? Tips for avoiding family fights and tax trouble," a study conducted by U.S. Trust found that some 70% of estate plans created by wealthy families fail to function as intended.
The reason most plans fail is due to lack of communication.
Succeeding generations destined to inherit the family wealth and business interests need to know what to expect and what to do when the time comes. Just as important, they also need to have plans of their own regarding the action they will take when the wealthy family member passes away. When they do not know what to expect and what to do, family feuds tend to erupt.
When it is all said and done, it's the family you're planning for in the first place. Therefore, in order to plan properly, first you need to understand your family. Proper planning ought to include discussing these issues with your family and then making the final decisions. Communication is key. We've said it before, proper planning starts with a thorough understanding of your needs, goals, dreams and aspirations. It takes into account your Values not just your Valuables. It starts with a thorough understanding of your family – those who you care about and who will someday receive the benefits of your success – and your family's dynamics. Let's work together to implement an estate plan that works for you. Remember, good planning is no accident.