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Family Wealth Management: Seven Imperatives for Successful Investing in the New World Order by Tom McCullough, Mark Haynes Daniell

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Chapter 5

Documenting Family Philosophy, Vision, and Values

Before setting out on the family wealth journey, it is essential to understand where a family has come from, and where it wants to go. In addition, defining the values it wishes to respect along the way will confirm who the family is and what its members stand for, as well as what they wish to accomplish through their investing activities.

Understanding Context and History

It is important to understand family history and culture when putting together a wealth plan. The sources of wealth, current assets and advisors, historic approaches to investment decision making, and the family’s gallery of investment trophies and scars can inform a plan most likely to fit with a family’s principles and objectives.

A family’s cultural approach to risk, their investment time frame, liquidity preference, level of engagement, and capability with regard to financial wealth management are all critical parts of the foundation of a family wealth plan that will be best suited to align with a family’s investing style, purpose of wealth, and specific performance objectives. Also, any limitations, impediments, or guidance to be provided by family trust deeds or governance principles needs to be understood at the outset of the process.

What Is Family Culture?

Recently, highlighted in one study as part of the academic research of Professor Heinrich Liechtenstein at the IESE Business School in Barcelona, family culture was ranked even higher than ...

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