Client Successes
Complex assets. Complex family relationships. Where to turn?

The three grown children approached us to handle their widowed mother’s finances. At first glance, there clearly seemed to be plenty.

Her assets totaled $20 million, including the value of the family business, four homes, life insurance coverage, financial partnerships, and other assets. With her fortunate circumstances, she was generous to her children, based on her loving belief that “What’s mine is (or will be) yours.” Everybody was sure her finances were more than ample to secure her and her family’s future.

Facts are facts and not to be ignored.

We launched into a deep analysis of the matriarch’s finances. We also listened carefully to the family’s values and intentions, matching them to what we were discovering about her wealth. After all, behind the desire for generosity must stand a strong dose of practicality. We were respectful of the fact that, in family relationships, being practical can sometimes require discussing tough issues and understanding everyone’s needs and perspectives. We uncovered that Mom had  a more significant reduction in cash flow than she or the family realized, due primarily to expenses on her four homes. As a result, her frequent large gifting to her children was too generous to be supportable over the long run. It was a shock to the family that Mom would run out of money for herself at age 75.

Decisive steps had to be taken.

As is often our model, our first step was to begin a series of family meetings so the siblings could talk as a group and share in making hard decisions on behalf of their mother and themselves. Our job was to listen sensitively yet facilitate some very tough conversations about priorities. The outcome was a living testament to their values of responsibility and mutual support. With their blessing, we restructured the mother’s life insurance to increase the amount of coverage without any premium increase. We also restructured a $5 million line of bank credit and assisted with obtaining a PPP loan, which gave the children more flexibility in expanding the family business to grow everyone’s assets. A protocol was created for selling two of the four houses and gifting the third to the children through a common but intricate estate planning procedure. One of the family’s limited partnerships was sold, freeing up cash. And with our help, the siblings set rules for themselves about how to access their mother’s funds when there was a specific need. Even better, they decided to set up a family foundation for charitable giving to give back to their beloved community.

We helped this family work together, make difficult decisions, and balance priorities. We did this by talking, listening, and problem-solving— with the family’s values always at the forefront.