Preserving Family Wealth and Purpose for Future Generations

It’s one thing to build wealth. It’s another to build a lasting legacy for your heirs. An estimated 70% of family wealth is lost by the second generation and 90% by the third.¹ As the wealth creator, you are not only responsible for transferring assets to future generations, but you are also the architect of the family’s identity, the curator of its values, and the designer of a structure that can outlast the personalities involved.

The wealth transfer paradox

Wealth acts as a multiplier; it amplifies both strengths and vulnerabilities. Studies indicate that 70% of inheritors eventually switch wealth advisors, often because they feel neglected, constrained, or unprepared.² That’s why it’s essential for the next generation to not only understand the wealth they will inherit but also to meet with their advisor and be clear on the plan and purpose behind the inherited wealth.

The numbers aren’t just alarming; they’re instructive. They reflect what happens when wealth is transferred without intention. Money without meaning becomes a liability. The potential risk is not limited to the next generation; it can also apply to those who do not become stewards.

The role of structure: More than estate planning

You may already have an estate plan in place for tax mitigation, asset protection, and long-term capital preservation. But estate plans alone are not a substitute for purpose.

Transferring wealth successfully requires a structure for governance, communication, and emotional alignment.

The family mission statement: A north star for generations

Think of your family mission statement as the strategic memo to your heirs. It documents not just what the family has, but why it exists. A well-crafted mission statement should clarify:

• The long-term goals of the family
• The values that guide decision-making
• The priorities that matter most (for example, entrepreneurship, philanthropy, and education)
• An honest appraisal of the family’s strengths and weaknesses

This is the core narrative that unifies generations and keeps decision-making anchored in shared meaning and not just financial interest.

Governance: The glue connecting wealth and wisdom

Wealth invites complexity. Family governance creates clarity.

Establishing a governance structure through a family council, board, or leadership group gives each generation a role in shaping the future. It also reinforces cohesion through communication, promoting:

• Strategic alignment on wealth and mission
• Clarity around key relationships and roles
• Family “health,” both emotional and functional
• Accountability across generations

This structure helps guide your family values through economic cycles, leadership transitions, and inevitable disagreements.

From values to policy: The family constitution

Values are aspirational, but a family constitution brings them to life. This document formalizes the structure and mission of the family. It defines roles, responsibilities, and outlines policies and procedures for conflict resolution and charitable giving. Your family constitution should include:

• The family values statement: a clear articulation of your guiding principles
• Criteria for decision rights, leadership succession, and participation
• The integration of business, investment, and estate planning strategy into family life

Think of it as your family’s operating system.

The strategic role of family meetings

Recurring family meetings, whether quarterly, biannually, or annually, build fluency across generations. They also create a space for education, development, and connection. Key agenda items often include:

• Governance updates and leadership transitions
• Estate planning milestones and distribution strategy
• Philanthropy alignment and next-generation engagement
• Business and investment reviews
• Family storytelling and heritage preservation

These meetings can — and should — evolve into a forum for mentorship, shared learning, and long-term cohesion.

Wealth transfer into the hands that follow

Legacy isn’t just about money moving downstream. It’s about future generations developing the judgment, confidence, and purpose to carry it forward and even improve upon it. Done well, this isn’t succession; it’s evolution.

If you are not a client and would like to learn more, let’s talk.

¹ “Preserve Generational Wealth During the $84 Trillion Wealth Transfer: Strategies for Financial Advisors.” Dunham Trust and Investment Services, Aug. 6, 2024.
² “Aging Boomers Bring Intergenerational Planning to the Forefront.” Cerulli Associates, July 19, 2021.

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