Bringing the next generation in, without handing over the keys

Heirs who meet the family portfolio for the first time at the reading of a will tend to make their first decisions badly. Involving them early is a matter of steps, not of a single handover.

Inheriting is not understanding

A portfolio built over thirty years carries its history with it: why this bank, why so much cash, why that property was never sold. To the person who built it, every position has a reason. To an heir who sees it for the first time, it is a list of names and numbers, and the natural reactions are to change everything or to touch nothing. Both are costly.

Information before authority

Parents often delay because they think involving their children means giving them control. It does not. The two can be separated, and taken in order.

1. See

The next generation sees the consolidated picture: what the family owns, where, and what it costs. No decisions are asked of them.

2. Sit in

They attend the portfolio reviews, hear the questions their parents ask, and meet the bankers and advisers.

3. Practise

They take responsibility for a defined part, such as a portfolio of their own or one investment they follow closely.

4. Decide

They join the decisions on the whole, alongside their parents, well before they have to take them alone.

Each step can last years. The pace is the parents’ choice, and it can differ for each child.

Different generations want different things

Heirs rarely want the same portfolio as their parents. They may live in another country, have decades ahead of them rather than years, care about how the money is invested, or want to back businesses directly. None of this is a problem if it is said early. It becomes one when it is discovered after the fact, between siblings who each assumed something different.

A family meeting once a year, with the figures on the table, is usually enough. What matters is that it is regular, that everyone hears the same thing at the same time, and that someone outside the family can answer the technical questions.

Where brothers and sisters differ

One child works in the family business and another does not. One wants income, another growth. Dividing a portfolio fairly is easier when it is liquid and well understood, and harder when most of it sits in one property or one company. Planning the liquidity for an eventual division is an investment question, and it is better settled while the parents can still explain their choices.

How we approach it

We keep one view of the family’s wealth and explain it to each generation in its own terms. When the parents are ready, we bring the children into the reviews, introduce them to the banks, and walk them through the reasoning behind each decision. By the time they inherit, they have already been part of the conversation for years.

This article is provided for information purposes only. It is not legal or tax advice, and it does not constitute investment advice, an offer or a recommendation. Inheritance and tax rules depend on each person’s situation, residence and nationality; please consult a qualified legal or tax adviser. The views expressed are those of the author and of GYRA SA at the date of publication and may change without notice.