The Simple Truth

Father's Day is Sunday. There is no rulebook for fatherhood...or parenting. So how do you balance an infinite list of traits you may want to impart to your children? The answer may be right in front of you...

As a father who grew up without a father, I've felt an imperative to teach my boys about resilience, respect, confidence, growth, charity, independence, compassion, and anything else I had to figure out on my own. It turns out they have just as much to teach me.

A recent lesson from my son:

3-year-old: "Dad, can you fix this? It’s broken."
(Hands me a rocket ship he broke in half)

Me: "I’m not sure about this one..." 
(in a voice of wisdom) "Some things...cannot be fixed."

3-year-old: "You’re a dad, you know how to fix it!"        

?? my son's definition of a father is the only definition that matters to me.

Most things in life are simpler than we make them out to be.

Simplicity doesn't mean ignoring details. It means having foundational beliefs that inform future decisions. It's true with parenting, family, business, investing, and all forms of wealth (not just material). Connecting the important (family) with the necessary (money) is a difficult but critical part of family stewardship and a frequent topic of discussion as a Wealth Advisor.

The ultra-wealthy will often establish "family offices" to address their multiple personal and financial objectives. These family offices are adept at developing and spelling out family goals and developing a broader philosophy about wealth and values. They might, for example, craft a family vision statement about the family’s optimal outcomes and the reasons for wanting them. Then they create a mission statement and plan with the steps to realize that vision.

From there, all financial decisions are made only after considering the family’s vision, values, and action plan. Any moves or changes should reflect those underlying factors. Families with these systems never lose sight of their key goals and do a superior job of avoiding chasing a “hot” investment or complex tax scheme, ignoring news and market noise, and achieving intentional financial outcomes. The simple basics of family values direct otherwise complex decisions.

That’s not to say their wealth planning is rigid. Without question, high-functioning family offices are designed to be flexible in adapting to changing circumstances—in family needs, for example. When goals change significantly enough, adjustments are made.

The lesson for everyone?

Start simple and be clear about what you want.

While it is important to be flexible, the decisions to adjust your planning should be deliberate and not a product of a lack of oversight or because you’ve discovered a shiny new investment “opportunity” that has nothing to do with your financial goals, values, and philosophy.