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Family Mission Statements Promote a Harmonious Estate Plan

11.21.16 | T&E Chat

Typically, much of the estate planning process focuses on money, but the most successful estate plans are founded on relationships. Building and preserving family wealth isn’t an end in itself. Rather, it’s a tool for promoting the principles that are important to you and other family members. Drafting a family mission statement can be an effective way to define and communicate these values.

Communicate clearly
Because each family is different, there’s no cookie-cutter formula for drafting a family mission statement. The most important thing is for the statement to clearly articulate your family’s shared values, whatever they may be.

Ideally, the mission statement will also create mechanisms for intra-family communication and for putting ideas into action. For example, the statement might call for regular family meetings or the creation of a governance structure for managing the family’s wealth,  and charitable giving program. Few families agree on everything. But facilitating communication and decision making in this way minimizes conflicts that can arise when family members feel they have no say. Some families choose to use an outside advisor to facilitate family meetings in order to make them more efficient, effective, and inclusive.

Consider a principled approach
Many people today are moving away from a rules-based approach to estate planning and embracing a principles-based approach. Rather than conditioning a child’s inheritance on a rigid list of “acceptable” behaviors, for example, a principles-based approach allows greater flexibility for trustees and others to make decisions based on the values you wish to promote. These values would have been articulated in your family mission statement.

If you feel a mission statement should be part of your overall estate plan, please contact me at SDitman@BerdonLLP.com or your Berdon advisor.

Scott T. Ditman, a tax partner and Chair, Personal Wealth Services at Berdon LLP, advises high net worth individuals and family/owner-managed business clients on building, preserving, and transferring wealth, estate and income tax issues, and succession and financial planning.