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family stewardship resized 600I recently listened in on a conference call that dealt with the topic of stewardship.  In the estate planning world this concept is usually focused on stewardship of family money. 

The speaker, Courtney Pullen reframed the concept.  He believes and I agree that we need to broaden the term.  We need to think of stewardship as family and business values.

It might not be around charitable giving.

Many financial experts and estate planning professionals will say that charitable giving is the best way to focus a family on what’s important for them.  This is a belief that might not serve a family well.

If charitable strategies are important for mom and dad, they might not be for children or more importantly for grandchildren.  I do believe that charitable planning can teach important money skills.  I also can see where having to participate in charitable planning activities with the family could become a dreaded activity.

The important thing to consider is not what you think.  It’s important to know how others in your family think about this topic as a way to teach about stewardship of resources and stories.

It might not be around starting a business.

Some families rally around the family business and guilt children into getting involved.  Tom Deans has written a great book on the topic, “Every Families Business.”

I don’t believe that business is the only way to teach about stewardship.  Just like charitable giving it will be perfect in some situations.  For many in the younger generation business is a bore.  They’ll have chosen other paths to follow.  It’s important to not jam the family business down the throats of younger generations.

Start with everyone defining stewardship for themselves.

Courtney pointed out that this is the best starting place.  Before trying to define stewardship as a group, each individual needs to define what it is for them.

I believe that you should have your family define stewardship on two dimensions.  First, you want to define what stewardship means for you around money.  The second should be what stewardship means for family values.

Don’t be surprised if younger generations decide that they can’t define stewardship around money.  They might not feel they have the right to do so.  They might believe that you’ve created the money and it’s your job to be the steward for this money.

You could have created this impression because of your actions.  Your children or grandchildren might have created the impression in their minds.  Either way, be prepared for this possibility.

Put together a stewardship statement for the family.

Once everyone has put together their individual statements, the really hard work starts.  Now it’s time to develop a stewardship statement for the entire family.  This statement is similar to a mission statement in that it should be short and to the point.

The stewardship statement is something the family can look at on a regular basis.  It helps everyone decide whether their actions are supporting good stewardship or not. 

To make the family statement meaningful you’ll have to make sure you really listen to what others in your family think are important.  If you jam through your thoughts, it will be your statement and not the family’s statement.  I believe using a professional facilitator for this conversation can pay big dividends.

Develop tactics and tools to support the family stewardship statement.

Once you have developed two family stewardship statements now its time to look at tactics and tools that support and make the statement real.  Your family has developed clarity around what’s important to them and you can find experts to help you institute tools to help reinforce what your family thinks is important.

If business comes out as a good reinforcing tool, you can help your family become business owners.  If charitable acts come through, you can help people get involved in the non-profit world.  If funding charitable activities becomes the tool, there are ways to do that.

The key is to understand there isn’t one answer.  In many cases a combination will help a family move forward understanding and implementing a stewardship policy.  The larger your family is the more complex implementation can be.

I would love to have a conversation with you about family stewardship and what it might mean for you.  If you’re interested in having a conversation, click on the button below you’ll be able to choose a time and date to speak with me that’s convenient for you.

Securities and Investment Advisory Services offered through NFP Securities, Inc. (NFPSI), Member FINRA/SIPC. Stage 2 Planning Partners and NFPSI are not affiliated.

This article is published for residents of the United States only.  Registered Representatives and Investment Adviser Representatives of NFP Securities, Inc. may only conduct business with residents of the states and jurisdictions in which they are properly registered.  Therefore, a response to a request for information may be delayed.  Not all of the products and services referenced on this site are available in every state and through every representative or advisor listed.

Topics: wealth management, personal value, family business transition

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