A
Conversation with Elizabeth Glenshaw
I once
had a client (a husband and wife) at one of the firms I
worked with who had a $40 million net worth. The husband
felt his life had been severely compromised when he inherited
all his money, so he and his wife chose to pass down only
$200,000 to each of their children. I was later asked to
work with the children of that couple, with the idea that
I would support them in developing good financial habits.
Each child had very different feelings
about what the parents had done, yet there were shared questions:
Why was I not worth more? How do I manage a lifestyle so
different from my parents’ life and the one I grew
up in? How do I talk with my children about our family and
its vast differences in terms of wealth?
The children spent many hours with me trying to understand
the mixed messages they had received, and were continuing
to receive, about their family’s financial wealth.
For example, the grandparents liked to take their grandchildren
on exotic trips and shower them with the good fortune that
wealth can bring. What message was being sent with these
actions? Was this healthy? The children clearly perceived
it as a mixed blessing. In particular, they worried that
the grandparents were exposing their grandchildren to a
lifestyle they probably would not be able to attain.
As financial advisor to the parents and
then, later, as trustee to the adult children, I found myself
in the middle of this family dynamic, which raised many
questions for me. Yet as advisor and trustee, my role was
to be a good steward of the assets for the benefit of the
individuals I was contracted to support. In that role, I
have to be careful not to be judgmental, not to take sides,
and to help my clients think about who they are, what they
want in their lives, and how their resources can or can’t
help them accomplish their objectives. If they can’t
do what they’re trying to do with their resources,
I help them figure out what other avenues they can take
to get there. I hope to free them of the constraint the
wealth can be in their lives.
During my professional career, I have
often had to introduce new inheritors to their wealth and,
at the same time, ask them to draw up a will and think about
what they want to do with their assets when they die. I’ve
seen people handle it wonderfully and others not well at
all. One couple I worked with had three young children.
They were willing to start early on to have family meetings
with the kids. We would sit down and talk about their accounts
and give the children a chance to participate. I love Charles
Collier’s idea that you start talking to children
when they’re young, and at some point you bring in
an advocate for the kids—not just your own lawyers
and investment advisors, but someone who will advocate for
the child. (See
“Resolving
Family Differences: Asking the Big Questions,”
in
More Than Money Journal
, “When Differences
Divide: Resolving Family Tensions Around Money,” Issue
#30, pp. 12-14.)
The way I see it, you can’t prepare
people in a two-hour meeting to even begin to understand
the role this wealth has or doesn’t have in their
lives. It’s lifelong learning. I say to my clients:
Start early, talk often, and work on gaining your own understanding
of the wealth in your life, so you don’t pass on your
baggage to the kids.
For related
information, see:
“
Incentive Trusts: Responsible or Controlling?
,”
More Than Money Journal, “Effective Giving,” Issue
#26, Spring 2001, pp. 7-8.
“
Trust
Funds: Blessing or Curse?
,” More Than Money Journal,
“Money and Children,” Issue #9, Autumn 1995,
pp. 6-7.
“
Twelve
Ways to Keep Trust Funds from Messing Up Your Kids
,”
More Than Money Journal, “Money and Children,”
Issue #9, Autumn 1995, pp. 8-9.
Talking with your children about money is an ongoing
conversation that should be a normal part of your
everyday life, like going to school, having dinner,
or learning a new sport. Listen to the questions your
children ask you. (They do ask you money questions,
whether they sound like “money questions”
or not.) Then really answer their questions. My daughter
recently asked, “Can I get an allowance? My
friends do.” It gave me the opportunity to engage
her in a conversation, letting her participate in
a discussion of what that allowance would mean. What
would the allowance be used for? Should it be earned
by doing chores or not? What did her friends do with
their allowance? Should some of the allowance go to
savings, to a giving pool? You may be pleasantly surprised
by the conversations you will have with your children
and how it will challenge your thinking.
—Elizabeth Glenshaw |
Elizabeth
Glenshaw is a senior associate with the Calvert Foundation,
which provides community investing opportunities throughout
the world. Prior to joining the Foundation, she managed portfolios
for individuals and families that integrated social criteria
as an essential investment objective. She crafted the Socially
Responsible Banking Fund for Vermont National Bank (now Chittenden
Bank), which makes flexible loans in the areas of affordable
housing, education, sustainable agriculture, downtown revitalization,
environment, and small business development.
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