Alongside a number of other disputes arising from unclear or old-fashioned language, it is clear that a number of laws and legal definitions are out of touch with the current reality and need to be brought up to date.
Specific examples mentioned by respondents included laws in relation to:
- Cohabitation (relating to succession).
- Same-sex marriage (recognition across jurisdictions, inheritance, adopted children).
- Inconsistencies with regard to lasting and enduring powers of attorney.
New family constructs and dynamics are driving demand. The increase in complexities and potential for conflict associated with the modern family has resulted in increasing demand for advisors and their services.
Tax advice, trusts, global/cross jurisdictional services and family governance advice in particular have all seen increased demand and succession planning tops the list of issues on which clients seek advice.
Tax advice is a key issue, particularly for multi-jurisdictional families, as a result of differing tax rules and the increased focus on tax transparency and compliance.
This is also seen in the increasing demand for global/cross jurisdictional services. Trusts are also in demand, their flexibility proving attractive in providing the ability to respond to changing circumstances in light of more complex family composition.
Some respondents also flag that they are seeing demand for alternatives to trusts, such as family investment companies.
Advisers need to recalibrate
One size doesn’t fit all. There is no longer a one-size-fits-all approach to meeting families’ needs.
Advisers are recalibrating how they work to ensure a joined-up approach, collaborating with other advisers across borders and professions to ensure the needs of the family are met, and embracing a broader skillset to support increasingly complex family dynamics.
As one respondent observed: ‘We all need to be slightly less focused on our little patch and collaborate with other professionals locally and internationally to help the family achieve their objectives’.
Communication and early planning is essential. Respondents overwhelmingly identified the importance of good communication – particularly within families, with early and open conversations about planning and succession – as the key factor for families.
This emphasis on communication – and in particular early communication – is a clear movement away from the traditional, more paternalistic historic approach of keeping younger generations sheltered from too much knowledge for as long as possible.
This approach is increasingly seen by advisers as archaic and being consigned to history. The other key piece of advice, and one that for many respondents was linked to communication, was to plan – well in advance.
Addressing the challenges
Navigating family politics is always difficult, but it has become even more of a challenge to advise the modern family as new generational perspectives are emerging.