The State of Succession Planning for Business Owners | Navigating Abundance

Speaker A: Only 1.1% of people can bench press 225 pounds. And yet 225 pounds is kind of seen as like this milestone. If it is your first day in the gym and somebody puts £225 on the barbell, you are going to be crushed. And so with this reluctance to hand things over, if you're not handing things over gradually, especially during that emerging adulthood time period, the kids are going to get crushed. If I. If I can say it as bluntly as that, it needs to be something that's passed down slowly. You can't just say, they've got. They're going to have money. They'll figure it out. Right? It's like saying to somebody, there's £225 on there, figure it out. It's not going to work out.

Speaker B: Welcome to the Navigating Abundance Podcast. Our goal is to encourage you to pursue your total family wealth potential through insightful conversation with experts and thought leaders in their fields. But first, some obligatory disclosures. Navigating Abundance podcasts do not represent investment, legal or tax advice. Any opinion expressed in Navigating Abundance Podcast is solely those of Christopher Tanke and his guests and and are based upon information believed to be reliable but not guaranteed. Podcasts are produced for educational and entertainment purposes only and should not be considered an endorsement of the guest or the views that they hold. Information shared may not be appropriate for your personal situation. Consult a qualified advisor for guidance. Investment advisory services are offered through Strategic Financial Group, llc, a registered investment advisor. Navigating Abundance is a trademark of Strategic Financial Group, llc. And now, here's your host, Chris Tankey.

Speaker A: Welcome back to Navigating Abundance. My name is Connor Mackey. I'm joined here today with Chris Tankey. Chris, how are you doing today?

Speaker C: I'm doing lovely. It's a beautiful fall day in Michigan. I know that's going to date the podcast, but I can't help but saying it. This is the time to live in the Midwest. It's October. We're going to have mid-60s, uh, for another seven or eight days. Not a cloud in the sky, fall colors. It's awesome

Speaker A: when you live in great moods so you can enjoy them while you can. That's right. We are in great moods. And if we weren't before, we are now. That's right. So, Chris, today we're going to be looking at the UBS Global Family Office report. This is a report that they put out every single year. And so we're looking at the 2026 report and particularly what we were looking at and noticing is succession planning and what they're saying about families that are ultra high net worth and their succession families or their succession plans. They surveyed 307 families with a total or an average net worth of $2.7 billion each.

Speaker C: Uh hm.

Speaker A: And we found some interesting things. Well, I guess I should say UBS found some interesting things that stood out to us.

Speaker C: Yeah, yeah, we sure did. And it's, it's really interesting what a lot of this is going to come down to priorities. Human beings are human beings. There are, there are things in my life that I know I should do, but I don't like have the will or the want to do and that's

Speaker A: it.

Speaker C: Ah, doesn't matter how many zeros are behind your, your net, uh, worth statement. That's a lot of what this is. It's very interesting. As I was reading through this, I think there was like 12 different findings, areas of findings that they had. Only one of them had to do with next gen readiness and succession planning. All the other ones had basically to do with uh, financial issues. I think that's telling in and of themselves that to me that's, you know, that's not giving the legacy wealth that a family has maybe enough focus or emphasis. Now again, it's a wonderful report and it's better than I could have produced. But it was, it just struck me very interesting. Out of uh, how many, what is there, like 65 pages? We've got like four or five.

Speaker A: Yeah.

Speaker C: Family succession. I'm thinking that, that, that's interesting how, how uh, even UBS might uh, approach it. So that'll, that'll have something to do with. We've skewed the way we're looking at this already. You know, we're probably at it. So. But I thought that struck me.

Speaker A: Yeah, well, I think it's telling of the industry, right? And uh, typically if you're working with somebody that has $2.7 billion, they're going to be business owners. In fact, I don't know any $2.7 billion family that doesn't own a business. And when you're working with business owners in particular, they want measurables, they want detailed goals that they can say, check that off the list. And a lot of the stuff that we talk about with legacy wealth, um, while there are certain goals that can be met and certain goals that can be checked off the list, a lot of it is going to be more uh, subjective and a lot of it's going to be per family and the ubs, they're working with a large amount of people. Right. And so it's more tailored to the broader industry rather than just here's this one family and here's what they need help with.

Speaker C: Yeah, but make no mistake that you know, 50 years after you're gone. Because we all tend to go 50 years after you're gone.

Speaker A: Typically

Speaker C: this. Yeah, typically the succession planning that you put in place is going to matter a whole lot to your family. And you uh, know, now is the time to do it. Now's the time to begin or to reinforce or to improve perhaps. Uh, we believe in navigating abundance talks about three areas of wealth. Your ledger wealth, which is your financial capital, your logistic wealth, which is your functional capital, and your legacy wealth, which is your family capital. If you're going to err on spending on time on any of these, it should be the latter. Your legacy wealth, your family capital, because that's what it's going to carry on the family business and the family spirit and all the other things that you've created, the family values. So yeah, uh, when we're talking about getting the next gen ready and succession planning, that should really uh, be a lot of our attention, take a lot of our focus, a lot of our energy to make sure that we're doing the best we can to accomplish what is, as you said Connor, it's uh, not necessarily a check the box but it's where the true lasting value of your life is going to be placed. It's not going to be a net worth statement. It's going to be in your family members.

Speaker A: Yeah. And now we'll get into the stats here right after I say this, but I would say I like to think a lot of families have this on their mind is a matter of they're not actually following through with it. And we can see actually from some of these key findings. Let me just look at the first one here. 57% of family offices report a wealth succession plan for family members, but only 27% have an organized process to educate and prepare the next generation. So 57% saying that they have a succession plan, but only 27% have a process to educate about that plan. And so it's on their uh, forefront of their mind. But the actual plan and education behind it doesn't seem to be shining through separately. 35%.

Speaker C: Can I uh, just interject if we look at. So that's problematic. 57% said yeah, we got a plan, but only half of them have it outlined how they're going to do it. Okay, that's a problem. But the other problem is 43% of family offices don't have a wealth succession plan.

Speaker A: Yeah,

Speaker C: 43%. And this is not an issue of not being able to afford it. So. Yeah. So we have some problems here. And I think one of the big problems is wrong focus.

Speaker A: Right. Right. What do you think people are focused in? Mostly focused on? If I can throw a curve ball your way.

Speaker C: Yeah, that's a.

Speaker A: Instead of the succession plan,

Speaker C: what

Speaker A: do you think people in our experience are mostly focused on?

Speaker C: Obviously, you know, you have business concerns there. There are a lot of complexities that running a family office, putting a family office together, leading a family office, staffing a family office, et cetera. And there's only so much time in the day.

Speaker A: That's right.

Speaker C: Yeah. But I think the other part of this, and we'll get into this, is that maybe even the will is there to do it. But, uh, there are some obstacles in the way. Will, those that are in line to succeed, are you able to communicate well with them?

Speaker A: Uh,

Speaker C: are they interested? Are you ready to give away some authority that's part of succession planning to let people practice on a certain area while you're still here. Right. You shouldn't. They shouldn't find out, you know, what they have and what they will be doing at the reading of the will. So.

Speaker A: Right. Right.

Speaker C: Yeah. Right. So, yeah, I think there's a variety of things. Um, but just life in my own life, you know, with my priorities in the family, they're not met as often as I would like to say they are. And that's just because my priorities aren't ever before me. There are too many fires to put out.

Speaker A: Yeah.

Speaker C: And sometimes they get the leftovers, I guess.

Speaker A: Yeah. Hey, there's nothing wrong with leftovers. Just maybe we want to make this a main course meal. Uh, no, I think you're right, Will. In time. Right. It comes down to. In many things in life, Will. And time. You can only do so many things in a day and you have to start prioritizing things. And what we're saying is that this should be one of the priorities for a family office or for families of significant means.

Speaker C: Yeah.

Speaker A: I'm m

Speaker C: just going to say I. I could not imagine. Now I'm going to come in strong here and maybe tick some people off.

Speaker A: I love it. You know, I love that

Speaker C: I have a family office. Right. And we've been blessed and there's a lot of great things that we do philanthropically. A lot of things we do for the community. A lot of things we do for our business and development of leaders there, and we touch lots of families, et cetera, et cetera. But 43% of these folks have no succession plan in place at all.

Speaker A: Yeah,

Speaker C: that is startling to me. It's startling to me. So I think a lot of this is, giddy up, uh, let's get serious about what really matters. I think it's a prioritization issue. And I, uh, just think that's just crazy because it's not a matter of money. We can certainly afford to get it done. And by the way, if you only have 30, uh, million dollars, that this affects you just as much, and you might not even have a family office, that's fine. The family office might be you and your husband and what you're doing around the kitchen table trying to manage this stuff. You still have three areas of navigating abundance, wealth, and, you know, you want to prepare your kids to receive a good portion of this or whatever. You're facing the exact same thing. So you don't have to be a billionaire to be maybe even called on the carpet with this. It's like, hey, what are you guys really doing? Look in the mirror. M. Wait, wait, stop, stop.

Speaker A: What

Speaker C: are we doing here? Because pretty soon the kids will fly. And, uh, you want to make sure that they're ready and you have things in order, not only emotionally, spiritually, physically, or whatever, but of course, in writing, depending on if they're involved with the business or how this is going to, uh, unfold. So it's a lot. It is a lot, but. But it's probably the most important work you could engage in. I just can't believe. 43%. This can't be right.

Speaker A: Unfortunately. Uh, I think it probably is. I think it probably is right.

Speaker C: Wow.

Speaker A: Because, again, business owners, to no fault of their own, are focused pretty heavily on their business. And especially if you're talking about $2.7 billion businesses, you're right. We should be talking about. Also, we're all about democratizing total family wealth in these concepts and navigating abundance. Uh, but if you're talking about that large of a number, a lot of business owners are aware that their success affects a lot of different families.

Speaker C: Yes.

Speaker A: And so you can understand why they might be focused more on their business. But what we're saying is you need to give time to your family as well, so that the business continues after you and those families are still taken care of beyond just your family. So let's talk about young adults, because this is uh, this is interesting. Uh, a lot of the young adults are not being brought in. 13% of next generation generations are fully involved in family office decisions. That means that they're, they're involved. Only 13%, 32% are partially involved and 21% of offices, the next generation is considered old enough to participate but has no involvement. And that's a global number. We might talk later on about the US in particular, but we'll see if we'll get there. So only 13% are fully involved. What do you think of that, Chris?

Speaker C: Yeah, I think that uh, you have to keep in mind, scope here to interpret this. You know, ah, if your family, there's 12 people in it that are affected by this, maybe a couple of brothers and their kids and nephews and whatnot. I ah, think these numbers are all the more startling that only 13% are involved. But you know, you could have a significant enterprise where you have 87 family members involved with this through a variety of generations, et cetera. Some, some are engaged in, in the business, others are just beneficiaries of, of some of the dividends of the business or whatever the case might be. And then I can see, you know, you know, what's the old adage, figures, lie and liars figure. It's, it's, it's difficult to, to, to uh, I think to put in scope exactly what this means other than to say the larger the, the enterprise and the larger the family members in it. If you're in the fourth generation, there's a lot of people with, with, with their finger on the pie. And so therefore 13% aren't fully involved. Okay, that might not be actually a bad idea. As a matter of fact, you might prefer it. Uh, but the point is that the smaller it is, the more significant that number would be. Yeah. So I think that's how I would interpret some of those numbers. No matter the size, if 43% of us aren't even interested in succession planning, that's, that's an indictment there. But, but in regard, in regards to, you know, involvement, that really depends on scope size, uh, uh, and generations, I think.

Speaker A: Yeah. Now, and maybe you don't want to get into this, but one of the things that I did notice in this report is it says that only, even after what you just said, only 5% of the next generation is currently involved in the US compared to some other regions in the world where you see 15, 14, 10%, 28% in the Middle East, 15% in the Asia Pacific, north uh, Asia, 15%, Southeast Asia, 14%. And it does seem, even with what you just said, the scope of it does matter. But percentages, percentage, uh, wise, there seems as if the next generation in the US Is less involved. Uh,

Speaker C: yeah,

Speaker A: and we kind of had a conversation about this beforehand about is it. Is it a desire for more individuality? Is it the family unit being not taken as seriously in the US I don't know if I can say that,

Speaker C: but,

Speaker A: uh, what are your thoughts on that?

Speaker C: Yeah, that's a pretty explosive question. Yeah. I guess what I would say is that we know in Latin American countries and Far Eastern countries, family is everything. In the United States, we've lost some of that. Um, and so, you know, so much of this, how do you get the next generation prepared, et cetera, et cetera, comes down to relationship as well. So it's, it's, you know, if. If the families are on the outs with each other, it's difficult to make progress together and row in the same direction of next gen prep. But, you know, if everybody's living under the same roof, then it's a lot easier. And of course, this, you know, Far east culture, Hispanic, uh, culture has a lot more of that going on.

Speaker A: Yeah.

Speaker C: Family is just almost everything. And the United States there is just a bit too much individuality. So I think it was startling when we saw that, you know, all these other regions are 14, 15, 20% U.S. 5.

Speaker A: Yeah.

Speaker C: It's like, wow. So I think that that's really a statement on culture.

Speaker A: Yeah, I would agree. Maybe start building your compounds now. I don't know.

Speaker C: There you go. There you go. Start speaking Spanish. I don't know.

Speaker A: Yeah, yeah, yeah. So one thing that also stood out to us is that, uh, the timing of these conversations. Because the big question that people might have is, okay, I do want to have these conversations, but I just don't know when. And so this is what UBS found. Family offices most commonly see ages 18 to 29 as the time to begin education in preparation. At age 30 to 39, 39 is the time for more active participation in decisions. So learning in your 20s and actually participating in your 30s. What do you think of that, Chris?

Speaker C: I think. I think that that's. There's. I get it. It's a big thing to have the big reveal on, um, how the business works, what it's worth, uh, how it's organized. And somebody that's 15 might be not terribly interested in that or not be able to handle that. And then once there is a reveal and you're understanding more, uh, and you have the maturity level to understand what's going on, you still might have eight or 10 years of prep work, depending upon your involvement, uh, your authority in the future, uh, before you're ready to take your slot. Which is why it's saying, you know, 30, 32 is when there's, there's more of an influx of joining, uh, the family office and I would say probably having voting shares within it. However, that being said, and I'm sure they don't mean this, but 18 to 29 is a time to begin education and preparation. I think maybe in an elevated sense on how our personal family office works. I understand that, but I would say that it would be very, very helpful to lay the groundwork for how a, uh, family of means will comport themselves in the future. Look at things there and their priorities, et cetera, how money works much younger than that. And I'm sure they're not really speaking to that, but I'd like to so to me

Speaker A: speak to it.

Speaker C: Well, uh, you know, three or four years old, they should be starting to understand, you know, that you do a chore and you get a nickel, and that's how it works. And you need to save up your nickels so that you can buy what you want at the store. And there's delayed gratification and there's hard work and there's the job well done feeling and all these other things that are created in the very simpler areas of life, mowing lawns and raking leaves. So, uh, yeah, I think that imprinting financial sense as well as, um, self worth not being tied to my money is an important thing. To start as early as you can and continue it because there are going to be some special pressures, uh, some different obstacles that come along with the opportunities of inheriting wealth, that you want your kids to be as well grounded as possible and your grandchildren to grow as well grounded as possible before that takes, uh, place. So you start early. It's part of your culture, it's part of your life. You just talk about these things.

Speaker A: Yeah, yeah. So one of the concerns, right, is if you have a child who is, we'll say 10 years old, they're going to be looking around and they're going to notice that their lifestyle is different from those around them. It's just through simple observation, you know, different vacations, different cars, different houses, different ways of celebrating things, they're going to notice these things. And so these conversations should start earlier now. The level of the conversation is going to be Different. Use the example of you get a nickel for a chore, right? Which is very, very cheap. But it does start

Speaker C: real

Speaker A: cheap. It is. See, you're thinking back to, uh, the good old days. That

Speaker C: was 1972, everybody. Sorry about that. I made a mistake. I used to get a dollar from the tooth fairy. It doesn't work that way anymore.

Speaker A: No, no, that's not the going rate

Speaker C: anymore.

Speaker A: My kids aren't old enough to experience that. So I'm sure, um, quite a bit at that point. But these are simple ways, simple things to start and simple conversations to have because they're already seeing it. So it's better that it comes from the parent rather than the kids at school who might point it out. And also, how do your kids respond to the kids at school when they do.

Speaker C: That's right. What happens to your

Speaker A: child

Speaker C: internally? Internally as they're dealing with questions or whatever. Again, it's always best to prepare and to start early. So, yeah, sure, 18 to 29 when you're talking about maybe the formal ways that the family office is working and whatnot. And I get that, but I would say so seeds now for foundational philosophical character traits now. So when those conversations are had, uh, that they're much better received and interpreted. We talked about the Personal Planning Institute that we went to in Boulder here this summer. And uh, we met up again, uh, with Mindy, uh, Kalinowski early. And actually her office is only, I don't know, about 30 minutes away from ours, interestingly enough. And Mindy's done a lot of work with Next gen education and she's teamed up with Susan, uh, Wells Genevieveen, and they've created something called Launch Learning. And we're very interested in having them come join us on the podcast and describe it better, which I think would be really, really good. So we're looking forward to that. But essentially you can go to the website Launch Learning just to let you know there's some things available. Now if you say, well, I don't know how to start with my 7 year old, well, man, have we got an idea for you. Launch Learning essentially is a subscription that you can buy that six times a year. A, uh, curated box will show up at your doorstep with all sorts of interesting games and books and exercises and stories and stuff that can be done so the kids can stay engaged, find it interesting to deal with topics such as. And here's the five. I'm looking at the website now. Money, skills, purpose and identity, leading and deciding, stewardship and philanthropy. The idea is, you know, Imprint right in these little chickens, these little chicks right now. Right. And wonderful things will come out of it. It's worth the time, it's worth the effort. It's not very expensive, really, for what it does. And, uh, you know, a grandparent can do it. Parent, caretaker, whatever. It's just a tool. But I think it's a really good idea. And what it is, is it's not only an idea, it's a process. We love that. So, yes, bring in young adults. Uh, sure. To the family office in the understanding at 18 plus. That's fine. The technicalities of it. But as far as developing their hearts and minds when it comes to, you know, stewardship and generosity and how your net worth is tied or not tied to money and all those sorts of things. Boy, that needs to be done in grade school.

Speaker A: Yep.

Speaker C: For sure. For sure.

Speaker A: Absolutely. Absolutely. Now, to give a little bit of credence to this report, Emerging adulthood used to be. I don't know the exact number of what it used to be. It used to be from 18 to about 22, 23. That's. That's the time in life when people are transitioning from, okay, you're no longer a kid now you're becoming an actual adult. You're not fully there yet. Right. You don't fully understand the world and consequences and all the responsibilities that comes with being an adult. Now, emerging adulthood is 18 through 29. It's been pushed back. So that. That does make sense. All we're simply saying is maybe there are some conversations that need to happen sooner to prepare for that emerging adulthood. And families can easily do that through some of the resources that we talk about here on the podcast.

Speaker C: Right. And I would suggest it would be a fine quest to make sure that early adult emerging adulthood doesn't happen when they're 26, that they've already arrived by the time they're 22.

Speaker A: Yeah,

Speaker C: don't it. Yeah,

Speaker A: that is the

Speaker C: norm. But that is the norm or that's the trend. I don't think that's a complimentary thing on society. So, you know, your grandparents got married when they were 17, so.

Speaker A: Right.

Speaker C: Uh,

Speaker A: a little too soon. Well,

Speaker C: yeah. So somewhere in between. But the point is that, that there are many opportunities and many challenges that come with wealth. And the, uh, sooner that they're able to understand how life works, the better off it's going to be for succession planning.

Speaker A: Yeah. Yeah. On that note, I know we just went through bullet point three. I'm going to skip down to five, then we'll Come back to four. So bullet point five. Among offices where the next generation is not fully involved, 52% are considering financial education or training. So we can technically say that a majority, even though it's only a slight majority, are considering these conversations in this education. Other approaches include philanthropy, entrepreneurial ventures, and participation in investment committees. So there's this want or consideration, I should say, of involving the next generation, and part of that is through education. Um, I think that we could increase that number a little bit by bringing it down to, you know, the four and five year olds starting the education sooner.

Speaker C: Yeah. So 52% say this would be a fabulous thing to do. And, and we're considering beginning it. You know, we have, uh, by the way, so maybe, I don't know, I don't know what that means about the other 48%. I prefer to think the 48% saying we're already doing it and the 52% are saying we're not doing it, but we think it's important. We're really starting to think about maybe we should do this. Okay, you come into our offices and you're going to see, uh, art board, I guess you would call it on, on an easel. And in 1942, typewriter type that we found are these words on that art board. Plans are nothing. Planning is everything. I think that's profound. Plans are nothing. Planning is everything. And those were typed out by Dwight David Eisenhower, the general that was really the great tactician of World War II. Basically, we all. And this is what this says. Right. Uh, we plan on doing that. We're thinking about doing that. And that's awesome. That's great there, that little, that little seed, germ of idea is sprouting and that, you know, we all have our aha, ah moments. None of us have arrived. Okay, that's great. Eisenhower would say, great. That's the plan. Where's the planning?

Speaker A: Yeah,

Speaker C: that. In other words, the, um, the want to is not enough. Right. Good intentions aren't enough. Right. So that's good. So at least, at least they're saying, hey, we really should be doing something. And if that's you listening to this, I think that's fabulous. Don't leave it there. Don't leave it there saying, what is that going to be? And if you don't know, bring some people in to help you or ask some other people what they're doing, uh, or whatever. But yeah, you've got to work the plan.

Speaker A: Yeah, yeah. You can't

Speaker C: just

Speaker A: have

Speaker C: a

Speaker A: plan.

Speaker C: Yeah,

Speaker A: absolutely, absolutely. But there are Some barriers that we're seeing. So let's talk about the barrier. The report identifies gaps in financial and governance, education, reluctance by the current generation to hand over responsibility, perceived differences in priorities and communication challenges. It notes that apparent disengagement may reflect a lack of empowerment rather than lack of interest. Let's take these one at a time, real briefly. Reluctance by the current generation to hand over responsibility. What do you make of this?

Speaker C: Uh, yeah, well, there you go. So here's the thing. You know, there

Speaker A: is,

Speaker C: in the future, you're not going to be here. We're pretty sure that's, that's going to happen. And so, you know, you can, we can put off preparing the next gen and say, well, you know, there's enough money. They're going to be fine. They'll figure it out. That's one way to do it. Or the other way to do it is say, hey, wait a minute, hang on a second, right? We got to figure this out. This is a big deal. Um, and so to figure it out and to start seeing progress means you have to start letting go of some things because you'll exacerbate your children if you don't let them have any skin in the game. So again, if you're, uh, it doesn't matter what gen, but let's do the Gen1 entrepreneur, uh, the rainmaker, the person that made it happen, the go go type personality A. And, uh, all that kind of stuff. That's great. And it's your baby. That's true. But it won't be forever your baby because you won't be here to rock it. So what are you doing now to prepare that generation? And you cannot do that unless you give, uh, allow some involvement. You listen, you say, hey, you know what? I want to step down from some things here because essentially you want your family to make. I, uh, would say, even if we could be negative, to make mistakes while you're still here. Right? I mean, you want to see this, you want to coach them, you want to interact with them, and maybe they have better ideas than you. And you might be surprised if they come up with it is awesome. But the point is, you're all doing it together versus, no, this is my thing. Wait for the reading of the will and, uh, you figure out what you want to do from there.

Speaker A: Right. If I could use an example, because we often talk about coaches and gyms and all that sort of stuff. So I'm a weightlifter. It's something that I've been interested in a long time. Only 1.1% of people can bench press 225 pounds. And yet 225 pounds is kind of seen as like this milestone. Right. It's. I, uh, don't know why. I, I think it might just be because with the bar in two plates on either side, it's aesthetically pleasing to be able to see £225 there. If it is your first day in the gym and somebody puts £225 on the barbell, you are going to be crushed. And so with this reluctance to hand things over, if you're not handing things over gradually, especially during that emerging adulthood time period, the kids are going to get crushed. If I, if I can say it as bluntly as that, it needs to be something that's passed down slowly. You can't just say, they've got. They're going to have money, they'll figure it out.

Speaker C: Right.

Speaker A: It's like saying to somebody, there's £225 on there. Figure it out. It's not going to work out.

Speaker C: I like that.

Speaker A: It's not going to work.

Speaker C: Uh, uh, folks, we are plain talking here. We're saying what we're meaning and meaning what we're saying, because this stuff really, really matters.

Speaker A: Yeah. Well, I think everybody's had that moment in their life where they were just thrown into the fire and they remember the stress and anxiety that that caused. You don't want to pass that on to the next generation, especially when the stakes are this high. Now, one of the other, uh, things that can cause some tension is perceived differences in priorities.

Speaker C: Yeah.

Speaker A: What do we make of that?

Speaker C: Wow. Now you've got generational gap. Um,

Speaker A: there we go.

Speaker C: And, uh, that's a real thing. And there is. The way you look at the world is going to be different. If you have four children, then all four of them, look, they all might have different views of it, different life experiences, different priorities, different values to some degree. And you know what? I wish I could say that here's the answer to that, but I don't have one. I think the best thing.

Speaker A: What are we here for, then?

Speaker C: Well, I just think that

Speaker A: you're right. You're right.

Speaker C: You know, uh, the encouragement would be. This is a relationship question. You just said it's all about relationship. Because even if you have a good relationship, you can agree to disagree on some things. You know, uh, you can make it through if you are. If you're a big game hunter, but your grandchild wants to give some money away to PETA people for ethical Treatment of animals. You m might not agree with that decision, but if you intervene on that, it might be appropriate to intervene. But it might be really damaging to intervene on that. Maybe you should say, we should agree to disagree on this, but you can take away autonomy, or on one hand you say, hey, I want you to figure out where you'd like this to go. But say, oh, no, no, not there.

Speaker A: Right, right.

Speaker C: This is all about relationships. At this point, when we're talking about disenfranchising next gen, it's all about relationships because you will find, because you're going to disagree, um, which is natural, normal, and in some ways I think can be healthy. But what you want to do is be able to say our relationship is above all of that and we can still dialogue and talk and prepare and whatnot. I think if you don't have good relationship with the kids, uh, or your grandchildren, it's going to be difficult to make some progress in some of these areas of succession. It just will. So the best thing you could do is slow down and go on a vacation, start building the relationships, find out if there's been offense, how do we solve for the offense, or whatever. It's all about relationship at this point. It really is. Yeah.

Speaker A: Yeah. So I think that this actually builds into these next two sub points. So we have perceived difficulties and priorities. Communication challenges and apparent disagreement may reflect a lack of empowerment rather than a lack of interest. The, uh, word that comes to mind is resilience. So one of the best things that you can instill within, uh, a child or really anybody, is this ability to be resilient, to overcome different situations. When you have these perceived differences in priorities, sometimes what it can come across as, especially in communication, is what you're interested in is not what I'm interested in. And since I'm the head honcho here, we're going to do what I want to do, and that breaks down resilience. We want to be empowering the next generation again, not just handing them the weight and saying, good luck, figure it out. We want to be empowering them. And so some of these conversations, which are going to take really hard communication, are going to require that we may maybe set some boundaries, but also maybe break down some of our boundaries and be okay with some of these disagreements that we already have.

Speaker C: Yeah. And, and, uh, we don't, we don't like it when sparks fly. I don't like it when spark. And maybe they won't, but if they do, I'd rather get those sparks flying and things Resolved, or at least make some progress and some understandings, because if you don't, there could be forest fires later when you're not here. So, I mean, it's, it's, you know, people are. Relationships, uh, are messy business, and that's just part of the deal. So, um, you've got. You obviously pick and choose your battles and all these other psychological things we can talk about. But, but in the end, uh, if someone is feeling like, I cannot be involved with this because my grandfather won't let me, you have relational issues here. Um, and you might not be aware that you might say, why aren't these people interested in working with me? Because maybe you're, you know, you need some.

Speaker A: Say it. You need some.

Speaker C: I'm not going to say it. Maybe you should change the way you view the world and view your family or view yourself. I don't know. And look, look, again, I, I'm dealing with my own stuff, so it's not like I'm. I'm not throwing mud at you. I'm just saying that. That, that's what it comes down to for all of us.

Speaker A: Yeah. No, I, I think that anybody who listens to this conversation is wanting to approach these conversations differently. They're wanting to approach because, again, we're talking about succession planning here. They're wanting to approach succession planning to the best of their ability. I think we can all have some humility and say we all fall short of some of these things.

Speaker C: Uh,

Speaker A: and that's why we're. That's why we have this podcast. That's why I hope people listen to this podcast, is for the ability to say, I want to be better at this. Yep. So now that we have solved all things succession planning, there's no need to do anything else.

Speaker C: There you

Speaker A: go. Fixed it all.

Speaker C: There you

Speaker A: go. There we go. Before we get into the three takeaways, anything else on this list that you wanted to bring up and talk about?

Speaker C: Honestly? No, I think we covered it. Uh, I think that maybe just one thing they did talk about, one way to get involvement of Gen 2 and 3, et cetera, is again, obviously, uh, give some tasks and accountability that's associated with it and authority so that can be completed and they can feel good about it and you're not getting your fingerprints all over and all that kind of stuff. But another way to do it, uh, I think an easy entry into this is philanthropy. And so, you know, most people care about making a difference. And, and that's a way to say, hey, family office stuff can be Cool, right? Because this is part of what we do at a family office. So start developing, you know, a, uh, spirit of giving, involvement with maybe hands on, rather than just writing checks or whatever, and to develop a heart for others of gratitude. But that's an easy entry into some of what a family office does, I think.

Speaker A: Yeah. And this is a good opportunity to plug our episode with Erica Mirich, which was our last episode, where she shared the example of start small. Have some kids put together a report or kind of build their case for why their $500 this year should go to this charity. It's a very simple way to start these conversations sooner rather than later. So, uh, Chris, what are three takeaways from this that you, you got out of this?

Speaker C: The first thing I do want to emphasize is that if you have 30 million. We've said it before. I'm going to say it again. Or $20 million or whatever. You don't have a family office. You are facing all of these things. Quite probably succession is still an issue for you. Even if you don't have a family business, you just have family wealth. Succession is an issue for you. If you want your children to be, you know, morally grounded and positive about, uh, their life and their position and their stewardship and all this kind of stuff, it's a big deal. So we keep using Family Office, which is, I guess, the genesis of this conversation. But this applies well beyond family offices. It applies to families with some sort of an inheritance. I mean, that's what this is. So in that putting down that marker, I just want to say there's a couple things. There's three P's. Uh, I was a preacher before, so I'm going to alliterate. Um, first of all, there has to be a priority. You have to say, this is what we're going to do. And, you know, roughly 50%, if we were to believe this report, let's discount it. 30% of family offices. It's not a priority. I cannot begin to understand that. I think the most important thing a family office can do is prepare the next generation. There is no thing more important, far more important than, uh, getting your taxes right, uh, and getting your compliance right, and improving your investment performance 50 years from now, that

Speaker A: as long as you don't end up in jail.

Speaker C: Well, I know, I know. Oh, of course you have to get compliance, but you know, you know what I'm trying to say. Uh, these things are eternal, and 50 years from now will matter to you. So it has to be a priority. There has to Be look myself in the mirror and say, okay, is this a priority? Do I see. The next thing is you have to have a process, right? Because we've Already read what 53% of people are thinking. They're committed to it. Yeah, we really should do this. But we're starting to think about how. Well, that means they don't have a process yet. And that's fine, that's good, they're getting there. But as, uh, Eisenhower said, if you just have a plan, but you don't have planning to make it work, it's nothing. So you have to have the will, the priority, the vision. Get that first, understand, say, you know what? This really, really, really is important. And maybe I've let the tyranny of the urging get in the way of it. Second after priority, make sure that you start developing a process or bring people in that can develop a process. How are we going to do this? What is our timeline for this? You know, what's our plan? And then finally, I think you need some promotion, or maybe the better word is prompting. A priority, a process and some prompting, which means it's very difficult to turn this ship on your own or by reading a book. It's amazing. We've done some really great interviews with people that have written some fabulous, uh, books and have resources on different family office readiness issues. And I keep hearing the same story. They said, you know, we're glad to produce this stuff. It's really neat. But to be honest with you, most people will read it and then put the book on the shelf. You know, there is. We need to connect with them. They need to work with us or somebody else to make this happen. And oftentimes you use the gym. We come back to that even in our website. As one of our founding principles, navigating abundance is a team sport. You can't do it on your own. And just like if you have a gym membership and you go and you lift some weights, you're not nearly as probable to accomplish your goal on your own, as opposed to hiring a trainer to meet you at the door, uh, and, uh, prompt you to get it done. And what, you know what, Accountability, right? So, again, the will to do it is great. The process is great, but you also need accountability. You need prompting, uh, you need promoting. You need somebody in the gym to say, come on, come on, come on. So, again, there are many resources that you can avail yourself to do that. Uh, if you want to have a conversation, we can certainly talk to you a little bit and understand your situation and encourage you along the way. Uh, we'd be more than willing to do that. But eventually it really boils down to not only having the vision and the will, but it also is motivation. And that takes other people, usually just how we work. It's how a professional athlete works, professional golfer. All they're doing is hitting the ball in the hole, and they've got a whole team of people that is prompting that person what they're eating, what their exercise is, what their strength training is, uh, psychologically, I mean, a whole team. That's what it takes.

Speaker A: Yeah, absolutely, absolutely. Because this work is important. So, uh, you got to put the resources behind it and the people behind it.

Speaker C: For sure. For sure. Your family is worth it, as we say all the time. Right? It's worth it. This is not easy, but this is leadership. This is what matters. 50 years from now, the kind of things we're talking about here, get them ready. Worst case scenario, their inheritance ruins them. We don't want that. What we want to do is for them to flourish with it, to do good with it, uh, and to look back fondly on, uh, their conversations with you and the preparation that they were given so they can handle the intricacies of inherited wealth. It's a divine calling. It's a sacred trust. And it's not always easy. But, oh, my goodness, in the end, um, I don't think in the end, anybody listening to this podcast on their deathbed is going to say, man, I wish it would have made another couple extra million. We could have. Wish that deal would have gone better. I think you might be saying, I wish I would have prepared my kids better, or I'm so glad that I did. Right. That's what it comes down to. And again, I hate to be melodramatic, uh, and if you're rolling your eyes hearing me say this, I understand that. But I would suggest that might be a message to yourself, because this stuff is not hard, but it's critical to understand it. And human being is a human being, no matter how much you have in your largest. So come on, come on. Your kids need you, and, uh, your grandchildren need you, and your organization needs you. And let's start spending some time and effort on next gen readiness, because that's where it's all going to come down anyway. So let's get ready. So if you haven't turned us off already. Oh, yeah, Chris, I turned you off 15 minutes ago because you said something that ticked me off. Okay. Uh, but I hope you understand that we're just trying to speak the truth in love. Right. And we do not. I personally do not have it all together. I'm listening to myself. I'm saying this, but that's the point. We all need to hear it.

Speaker A: I don't have it together either. I keep on telling myself, I've got time.

Speaker C: I

Speaker A: was going to ask

Speaker C: you, are you benching 225? Do you have that together?

Speaker A: I did at one point. I don't know if I could today.

Speaker C: Uh. Uh-huh. Okay.

Speaker A: That's probably gone. Having two kids will do that to you.

Speaker C: Wait, no, that. That's what your wife says. You can't use that excuse.

Speaker A: I don't know. I don't know.

Speaker C: Oh, man.

Speaker A: I'm with them all the time, which is

Speaker C: what's

Speaker A: important, rather than lifting.

Speaker C: Well, this is a great conversation. I, uh, really appreciate you leading this, Connor, today, and again, I. I'm just. I'm just honored that you would come into our podcast and roll around in it with us. I hope that this was helpful for you a little bit. And again, I think that so much of this is just inspiration or vision, and if we've imparted some of that or lit a fire under you, uh, wow, that's everything to us. So we really do appreciate that. So, yeah. So for Chris Tanke and Connor Mackey here at Navigating Abundance, we want to thank you so much for tuning in. And as we said before, remember, we do this because your family really is worth it.

Speaker A: Thank you for joining us for today's episode of Navigating Abundance. If you found this information useful or helpful in any way, let us know in the comment section below. If you'd like to see more content like this and follow our podcast, you can find us on all major podcast platforms. If you're interested in working with today's guests, you can find their information in the description of this podcast. If you'd like to know more about Navigating Abundance and how we may help you, or find more resources related to what we do, you can find those@. Ah, navigatingabundance.com.