When most people think about financial planning, they picture saving for retirement or growing and protecting their wealth. There’s also a bigger picture – one that spans generations. Research by firms such as Morningstar and Cerulli estimates that in the coming two decades, more than €85 trillion in assets will potentially move from one generation to the next. Yet, many families haven’t prepared for this transition, which can result in avoidable tax bills, family conflict, and wealth simply disappearing.
Multi-generational financial planning isn’t just for the ultra-wealthy. Whether you have a modest estate or significant assets, taking a proactive approach can protect your loved ones and ensure your financial legacy endures. Here’s why it matters, and how you can start.
Preparing for sudden inheritance
A sudden and unexpected bereavement can leave heirs unprepared to manage inherited wealth. At that stage in life, many young adults haven’t yet worked with a financial planner or investment advisor.
Imagine spending decades working hard, saving diligently, and investing wisely, only for your children to feel overwhelmed or unprepared when the time comes to inherit. Effective multi-generational planning focuses not just on passing down wealth, but on preparing your family to handle it with confidence.
Supporting major life events
Significant life milestones such as marriage, the birth of children, divorce, bereavement, or retirement are often when families most need guidance. For example, in Ireland today, we see many parents wanting to help their adult children buy a home. Indeed in Australia, the “Bank of Mum and Dad” has become the fifth-largest lender in the housing market!
While this generosity can make a huge difference, it’s important to protect your own financial wellbeing and ensure fairness among siblings. Without clear agreements, family tensions or resentment can arise later. We can help you structure gifts or loans thoughtfully, documenting arrangements so everyone knows where they stand.
Fostering family harmony through transparency
One of the greatest gifts you can leave your family isn’t just financial security, it’s clarity. When families lack open conversations about money, misunderstandings and conflict can follow.
There is merit in holding family meetings, potentially facilitated by us, to:
- Discuss succession plans and inheritance expectations.
- Clarify each person’s role and responsibilities.
- Create shared goals and family mission statements.
This doesn’t mean you have to reveal every financial detail to every family member. But involving key stakeholders – children, their spouses or partners (who are usually the confidantes of your children) and other decision-makers – can prevent surprises and build trust.
Educating and empowering the next generation
Many parents worry that their children won’t know how to manage an inheritance responsibly. That concern is valid – sudden wealth can be challenging, particularly if beneficiaries haven’t had the opportunity to learn about budgeting, investing, and long-term planning.
Financial education can start small. We can help younger family members:
- Understand how investments work.
- Learn about tax and pensions.
- Build confidence in making their own financial decisions.
With your endorsement, we can mentor the next generation in your family, laying the groundwork for smoother wealth transfer and a healthier relationship with money.
Aligning your wealth with your values
Younger generations often want their money to reflect their beliefs, whether that means investing sustainably or supporting causes they care about. Multi-generational planning is a chance to connect your financial legacy with your family’s shared values.
For example, you might:
- Create a charitable foundation or set up regular donations.
- Build an investment strategy with a tilt towards sustainable investing.
- Involve children and grandchildren in choosing causes to support.
These conversations aren’t just about numbers; they’re about purpose.
Taking the first step
If you’d like to actively consider your multi-generational planning, here are some initial steps you can take:
- Start the conversation early: Talk to your family about your hopes, values, and any concerns. Early discussions help set expectations and reduce future stress.
- Include all relevant family members: Include your children and consider involving their spouses or partners in meetings. This inclusivity builds trust and prevents misunderstandings.
- Document your plans: Whether it’s a will, a family agreement, or a loan structure, clear documentation is essential.
- Educate and empower: Encourage younger generations to learn about finances. Invite them to meetings and share resources.
- Work with us – we understand families and money: Involve us in the process. We can bring experience in these matters, can adapt to different generations’ needs and communicate in ways that resonate.
Multi-generational financial planning is about more than just passing down wealth. It’s about preparing your family to manage it wisely, live confidently, and stay aligned with shared values.
If you’re ready to begin the conversation, we’d be delighted to support you and your family because planning for the future isn’t just about numbers—it’s about people.
