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A
Family Mission Statement Can Help Any Family Manage Assets,
Philanthropy and Direction
A
family doesn't need a surname like Vanderbilt to benefit
from a family mission statement. A mission statement is
a collaborative document created by one or more generations
of family so standards and goals can be set for the handling
of all family assets, including businesses and philanthropy
in particular.
While
mission statements aren't legal documents – in fact, many
are done both in written form and on videotape as a companion
to legal wills and directives -- their purpose is to make
a record of the family's values, goals and aspirations and
how those sentiments should drive future decisions about
family wealth management, business succession plans and
charitable pursuits. Multi-national companies have mission
statements. Non-profit corporations have mission statements.
A mission statement for your family, helps identify and
clarify specific values and goals, facilitates group decisions,
instills confidence and encourages unity.
It
should also identify family leadership who will work with
other relatives in implementing those goals.
While
the end product should produce a document built from discussion,
argument and consensus, it's not so much about the piece
of paper as the process. Many families start the process
as a way to build consensus about long-term financial, business,
estate and philanthropic goals, but the conversation can
take twists and turns that don't directly involve the family
money. In this process, a family can identify the strengths,
weaknesses and unearthed priorities of all family members
and might reveal leadership few had expected.
Trained
financial advisors including financial planners, tax experts
and estate attorneys, can help explain the process and set
an agenda for families to follow in creating the mission
statement. While some extended families may elect to bring
in a facilitator to guide their process, there are generally
four components to a family mission statement – estate issues,
philanthropy, business planning and family dynamics in general.
It
also helps to start with some questions that can guide the
discussion. Many experts start with questions that first
get family members talking about their relationships and
how their dynamics work, and then move into business and
money matters.
- What's
most important about our family?
- What
do you think our goals should be?
- When
do you feel most connected to the rest of us?
- How
should we relate to one another?
- What
are our strengths as a family?
- Where
do you think we'll be as individuals in five, 10 and 15
years?
- In order,
what are the five things you value most in life?
- How
should we behave toward each other?
- How
should we take care of relatives who are or become sick
or disabled?
- How
should we resolve our disputes?
- How
important is the family business to you?
- What
should we be doing differently with our family money as
well as our assets inside the business?
- What
professionals or structures should we bring in to help
us manage our wealth?
- What's
the best way for us to be building our wealth?
- What
do you think the role of our family should be in helping
the community?
- What
should we be doing individually and as a family with regard
to philanthropy?
Structurally,
the written mission statement can be whatever you agree
it should be – most experts say it should be no more than
a paragraph long, but that's a guideline, not a rule. It
is also very important to focus on the positive, meaning
what you want to accomplish and achieve as a family, as
opposed to want you want to avoid. And it needn't be set
in stone – a family should have a meeting every year or
two to revise or approve its mission. The family mission
statement helps a family establish its identity and the
variety of voices within, and those voices may be subject
to change over time.
The
family mission statement is a living, breathing document
that can evolve over time. In today's fast paced world,
it is easy to get caught up in the here and now, a family
mission statement can help you stay true to your family's
values. As a result, families may not feel the pressure
to keep up with the Joneses because their mission statement
helps achieve balance. It is also very important to focus
on the positive, meaning what we want to accomplish and
achieve as a family, as opposed to want we want to avoid.
The
right mission statement can help reset goals and diffuse
tensions later. It can also be used to moderate discussions
that inevitably happen after major changes within the family
– death, divorce or happily, an increase in the number of
heirs and participants.
As
for the age of the participants, it can start in very basic
form with younger children and the process can mature as
they age. It's actually a good idea to bring young members
into a customized version of the process for youngsters
so they can comfortably adjust to working as adults with
the older members of the family.
For
additional resources on how to create a family mission statement,
please consider utilizing any of these websites
June
2010 – This column was authored in cooperation with Financial
Planning Association.
This
material is for informational purposes only and is not intended
to provide specific advice or recommendations to any individual
or group. Before making any financial decisions or commitments,
please consult with your financial professional.
Securities
and financial planning offered through LPL
Financial, a Registered Investment Advisor. Member FINRA/SIPC.
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