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Intergenerational wealth management

By beled | December 23, 2014

David Leslie, a director of Belmont Asset Management, discusses the importance of intergenerational relationships in wealth management.

In any family, there will always be an appropriate time for the financial reins to pass to the next generation. This will differ from family to family, depending on personal circumstances and no two families will share exactly the same experience. It goes without saying that the generations that created and nurtured the family’s wealth – through hard work and diligent management – would want to see that wealth preserved for future generations. Good communication and a structured handover from one generation to the next are crucial elements in the success of this process.

It is also worth mentioning that when the reins pass, so too do the responsibilities that go hand in hand with wealth. It is incumbent upon the incoming generation to take the time and effort to understand how the family’s investments have been managed in the past before making any decisions. A trusted, independent wealth/portfolio manager is a crucial resource at this important time and provides a ‘steady hand at the tiller’ and essential continuity to the family.

Throughout this often difficult time, the most important aspect is trust. Without trust, the entire exercise is futile. Personal relationships help to establish trust and allow proper, professional communication about the service being provided, in essence delivering peace of mind to both the outgoing and the incoming generations.

At Belmont, one of our aims is to offer lasting value to our clients and this often means developing relationships with the next generation as and when this becomes appropriate. This process should begin long before the reins are actually handed over. As the custodians of a significant portion of our clients’ wealth, we value personal relationships with each client and these often extend to their descendants. One generation’s investment objectives are likely to differ from the next generation’s. It is important that we understand these changing needs and preferences, so that we can make astute and well planned changes to investment portfolios where necessary.

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