The Land Of Wealth — Settling Your Wealth Allocation Principles

A series for those journeying through family business succession.

Knowing where your wealth lies and considering how you intend to transition and share it with the next generation in a family business transition can be complex.

Take the time to get it right, discuss it with your family, and seek professional advice early. Settling your wealth allocation principles is one of the five lands that you must transition in developing your family business succession plan.

No matter how far away you believe the eventual transition of your family business may be, settling your wealth allocation principles should be done as early as possible.

They should then be communicated to family members with all subsequent actions and decisions made consistent with those principles. Of course, if the situation changes, then you should amend or update the principles.

But your principles should always be established to support the cornerstone goal of succession, which is to ‘enable the compounding of wealth from generation to generation while ensuring family unity, individual growth and a sense of contribution’.

If you believe you have addressed your wealth allocation principles, then here is an exit checklist, which you can use to tick off your actions:

  1. Have you drawn up your wealth map?

2. Have you located and gathered all the required supporting documentation of ownership and control for all of your entities?

— Have you sought legal advice (where applicable) on any points regarding ownership and control that are unclear?

3. Have you written up your initial thoughts on:

— The allocation of wealth across the next generation?

— Specific assets/entities to be transitioned to various family members?

— How to allow for you and your spouse’s individual financial needs?

4. Have you communicated your approach on how you plan to allocate wealth to family members to ensure their support and not to give rise to any future conflicts?

The ‘Land of Wealth’ is one of the five lands that you must transition through before reaching the point where you are able to pull together your family business succession plan.

#familybusinesssuccession #familybusiness

An Invaluable Resource — ‘Transition — Orienteering The Lands of Succession’

A Topographical Guide To Orienteering Family Business Succession



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