The 28-page report, The Meaning of Wealth in the 21st Century, found the challenge for many successful and wealthy families was “learning to identify the skills they do not have”.
The report said: “Getting this balance between family and professional advisers can be incredibly challenging. Family leaders have to work out how to bring in the right external skills and personalities without over-professionalising the structure and blotting out the family identity.”
Key to getting this right were five steps: identify reasons for transitioning wealth; allow time for decision making; as family leader, embody the change desired by the family; recognise limitations and appoint advisers; and, lead by considering how future family generations will generate wealth rather than simply managing it.
The report added: “The secret to success is in understanding the process of wealth creation and what needs to happen to ensure that the third and future generations remain active and engaged.”
Withers based its findings on quantitative research among 4,500 individuals in Asia, Europe and the Americas, each with more than $10m (£5.89m) in personal wealth.
It also found that “rather than counting their money, the most successful are making their money count by taking practical and incremental steps to be economically and socially active”.
In the US in particular, the report stated that a growing number of wealthy families are “re-assessing the potential of their private capital to have a positive impact on the social and economic challenges they see around them”.
Adviser view
Lee Goggin, co-founder of London-based Find a Wealth Manager, said: “Nobody likes contemplating their own passing, or that of their loved ones, but taking the right steps now could make all the difference to a family’s future financial security.”
