Multi-Generational Planning for High Net Worth Households



It’s not a bold statement to say the financial planning needs of a high net worth household are notably different than your average middle class financial plan. While not every advisor is looking to focus on high net worth households, those that do need to be prepared for the intricacies and expectations of high net worth planning needs.

One aspect will be our topic du jour: how do you incorporate multi-generational discussions into high net worth discussions?


Talking Terms: How Do We Define High-Net-Worth Individuals?

There are different definitions for what makes someone high-net-worth, but financial publications generally define it as possessing more than $1 or $2 million and beyond. According to the Global Wealth Report conducted by Credit Suisse in 2020, there were 21.9 million millionaires in the United States. Most of those millionaires have families to whom their wealth will go eventually. It makes sense for those with considerable wealth to adopt strategies to ensure their wealth will not disappear before their grandchildren can benefit from it.

A person whose liquid assets are valued at more than a certain threshold is referred to as a high-net-worth individual (HWNI), which is a categorization used in the financial sector. Individuals who are considered to be in this group often have liquid financial assets totaling at least one million dollars.

Those with a high net worth tend to have assets readily convertible into cash, such as their principal property or a fine art collection. When it comes to managing their wealth, HNWIs often seek the advice of experts in the financial industry. Because of their great net worth, these people often become eligible for extra opportunities and possibilities. They are also often more concerned with questions surrounding tax planning to protect their wealth.


What Is Family Wealth Planning?

To leave a lasting financial legacy for future generations, many people engage in family wealth planning, also known as generational wealth planning or estate planning. Investment management, philanthropic giving, real estate and asset transfer planning, and retirement and tax planning are all possible components of a well-rounded family financial strategy.


How Does HNW Family Wealth Planning Differ From Financial Planning?

Financial planning is a broad brush, covering many facets of financial decisions from retirement to education to real estate. Financial planners assist their customers in establishing long-term financial objectives, such as saving for retirement or a second home, and short-term objectives, such as managing taxes and preserving assets.

In contrast to financial planning, family wealth planning looks to the future and seeks to assist members of the next generation secure or expanding their financial destiny. When a HNWI accumulates generational wealth, there is more at stake in how that wealth is passed down. Much of the same principles of financial planning apply to the process of building a lasting legacy from affluence within a family.

Some of the key priorities in HNW family wealth planning cover topics like:

  • A clear plan for how instructions are communicated, both before and after death
  • Philanthropic priorities and how they affect family allocations
  • Key decision makers for a wide variety of assets like trusts, estates, enterprises, and other activities.


The Four Most Frequent Obstacles to Family Financial Planning

As a financial advisor, you’re used to guiding clients through difficult financial choices that affect their future. It can be even more delicate to talk them through decisions that primarily affect their loved ones. (This can be especially challenging when the family isn’t all on the same page.)

#1 Overcoming “I’m not ready for that conversation.”

Financial advisors know that money conversations are already vulnerable as it is. Family wealth planning introduces an entirely new level of delicacy because of the private nature of family interactions.

The anxiety may stem from a parent’s unwillingness to disclose financial details to a child or the concern that the youngster is unprepared to handle a large inheritance. When people feel afraid, it’s usually because of something personal, like a reluctance to let go of control or an inability to accept death. The inability to initiate conversations is often the problem.

The biggest threat to your clients’ family wealth may be the absence of this conversation itself. Work to show your clients the value of including their heirs in the planning process is essential to safeguarding their legacy after they overcome their reluctance to do so. It may be challenging but encourage them to consider the value of working out a family wealth plan.

#2 Getting Everyone in the House on the Same Page

A financial advisor can help you sketch out and carry out a well-informed, all-encompassing strategy. But when you throw in extra people, even the most well-thought-out strategy may go wrong.

Finding common ground may be difficult because of thorns like ideals, politics, or past hurts. You may encounter conflicting personalities. You may encounter differences of preference in the priorities of individuals (the here and now vs. the future). Decisions might be delayed, or an impasse can occur if unasked or unresolved questions are not addressed.

#3 Creating a New, Clear Organizational Structure

Once an inheritance is handed to heirs via a trust or other institution, it is critical to establish clear responsibilities for all parties involved to ensure the continuation of family harmony and financial success. In lack of clarity, the family is left to resolve the confusion without the ability to clarify questions with your client who passed away.

When opposing notions about the significance of money, potential jealousies, eccentric personalities, and other details come into play, it may be difficult to preserve the overarching family values that are the basis of family wealth. Just how is authority distributed? The question is, who will be in charge? When will a choice be made, and how? Can we expect a family meeting? It is crucial to adhere to the original aims of your customer while maximizing the long-term potential and capabilities of family wealth.

#4 Asset Diminishing Effects with More Successors

One of the challenges of multigenerational asset management is the increasing number of successors to an estate. Your client’s legacy might be diluted if they don’t have a cohesive strategy and the will to stick to it despite competing beliefs, priorities, and interests within the family.

Best practices created to benefit your clients and company may help you overcome these obstacles.


Wealthplan Group Can Be Your Guide

Financial advisors’ expertise is more in demand than ever as the economy and financial world become increasingly complicated. Differentiating yourself is essential if you want a piece of this growing market, as many investors seek expert advice and assistance.

Several assets are at play, which will only rise with time. Working for a company that respects your autonomy and provides the tools you need to serve a varied clientele will put you in the best position to take advantage of this generational wealth transfer opportunity. Increase your company’s visibility with the help of Wealthplan Group’s comprehensive software, cutting-edge services, flexible investment options, and personalized advice for growing your business.







SOURCES USED:,The%20Bottom%20Line,for%20additional%20benefits%20and%20opportunities.


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