Selling your successful business has contributed to your wealth... How to bequeath your fortune to your heirs?

Most of my clients tell me that they don't want their children to know about their bank balances. This is due to fear that they would retire early and buy a Ferrari while they’re at it.

To address this situation, I ask my client to answer two questions: what would be the ideal time for their children to become aware of their wealth? While they’re alive or at the notary's?

In most cases, they choose the first answer. But how do you pass on one's wealth, without the risk of squandering?

Let's go back in time: in the fourteenth century^e this same question arose in Europe, and that’s when the family office appeared. In the nineteenth century, a certain M. Rockefeller was interested in this way of transmitting his wealth. He was one, if not the first, establish a family office in North America. Today, almost all great North American families have a family office. Organizations/associations accumulate wealth daily by adopting this way of doing things.^e siècle, un certain M. Rockfeller s’est intéressé à ce moyen de transmettre sa richesse. Il a été l’un, sinon le premier à mettre sur pied un bureau familial en Amérique du Nord. Aujourd’hui, les grandes familles nord-américaines ont presque toutes un bureau familial. Des organisations/associations s’enrichissent quotidiennement en ayant adopté cette manière de faire.

How do I do it?

First, there will be a change in culture. It is important discuss their financial situation with their families.

Then, you will have to talk about values and what is important to you. What are your ambitions regarding the way your wealth is invested? How can you give back to society? Is it up to the family council to specify the family values? Generally, all children and grandchildren become actors in it, as soon as they can grasp the nuances of the value of the family. In some cases, spouses will be incorporated. One external consultant will oversee the meetings.

When this step is completed, it will be necessary to set up the family office.

Why is it important to set up a family office? Why not put everything in private management? In the family office, you're going to have an impact on the development of financial support for your family. In the case of private banking, on the other hand, you trust that they can invest and generate a return that will meet your needs and investor profile.

The second reason is the problem of children and grandchildren. They may not be able to work in the company. Yet, they have talent and ideas. In this case, the family office will be present to support them in the development of their own business.

The third reason is that in decision-making, in validation or in the refusal of potential investments, you won't have to step in as a father, grandfather or friend. You will have professionals who will recommend whether or not to accept an investment. In addition, they will take care of the necessary follow-ups during such investments.

Do you remember the Ferrari and the early retirement? When developing your values, this will not be possible. The descendants will only afford luxury products thanks to their work and not thanks to your wealth. This is the great particularity of the family office/consortium. You will be able to keep control of your wealth even after your death.

And to be perfectly honest, even if your kids don't know the balance of your bank account, they have a view of your home, your automobiles, your lifestyle. You should therefore talk to them about it, since they are not devoid of common sense.