We’ll call him Pierre – an entrepreneur who started a business many decades ago and has four children. Two are involved in the business, two think they are. What’s the business worth?  He “thought” 25 million dollars (that’s what his friend, the buyer, thought it’s worth)…

It all started with a casual conversation that made Pierre want to meet with us to talk about his situation. We met Pierre and it was clear from the beginning that he wanted to do things right but didn’t know where to start. We walked him through the Life Meaning ExerciseTM and discovered that harmony amongst the siblings is his number one interest. 

A failure to plan

When we met with Pierre, it quickly became clear to us that his worries were rooted in one key problem: For more than two decades, he had been so busy growing his business that he never planned for the day he would no longer be in the business. 

Instead of feeling happy about this impending liquidity event, Pierre was worried. He felt something was missing.

His children were unaware the business could possibly be sold and expected to take over when his father retires. One of the children, who had never expressed any interest in the business, does not know how to manage money well and Pierre was concerned that the sudden influx of cash would make him even more careless with his spending. Pierre’s wife is not involved in the business but was mortified about what could unfold.  She’s not financially sophisticated and had no idea how the business operated but had a very clear understanding about the dynamics between the siblings.

As a result of Pierre’s failure to plan, his children were not prepared to continue the business, let alone be stewards of wealth. In the absence of a clear succession plan for the business, two of his sons nurtured false hopes they would lead the company one day. Pierre himself was not prepared to relinquish control of the business he had built, even as he was getting ready for its acquisition.

First steps: What we did for Pierre

Pierre is a person who’s used to being in control, so we immediately took action to organize and manage the elements in his life that made him feel like things were in disarray. This is not the place to judge or point fingers but to help, understand and guide. One of the first things we did was to retain a business valuator to analyze how much this thriving business is worth.

In the meantime, we sat down with the entire family to discuss what was happening with the business and what that meant for everyone. Three of the sons reacted angrily to the news but calmed down as we advanced the conversation towards what needed to happen next.

Pierre had never talked to his children about money, so having us there made it easier to have an objective and constructive discussion about how he intends to share his wealth now and in the future. This was also a good opportunity to get Pierre’s grown children to agree to undergo education sessions on financial literacy and wealth stewardship.

Taking care of family, today and in the future – going back to basics

The entire family wants this to work out.  That’s half the battle.  They also acknowledge that they have never had a financial plan created for them.  They just know that they are “fine” but when it comes to the future and their ongoing reliance on the revenue they get from the business, they don’t know how much they need.

We created a financial plan for each of them. Their circumstances and lifestyle choices resulted in very different capital needs to achieve financial independence. The siblings decided that these needs should be kept confidential, but they were a strong starting point for each of them to understand where they stood.

Finding purpose after success

The valuation came back much (much!) higher. While Pierre was looking forward to finally unlocking the wealth he had built in his company, he also felt a great deal of uncertainty about the future. With his wife’s health declining at rather fast speed, he could not imagine what life in retirement would be like for him. Their dreams of traveling the world together was no longer a possibility, and he felt guilty about making plans that would not include her.

To help Pierre find purpose in his new life, we brought in a life coach to work with him one-on-one. Through these sessions, Pierre was able to find clues to what pursuits he would likely find most fulfilling in the next chapter of his life. He also identified the social causes he’d like to support, financially and through volunteer work. We took these findings and incorporated them into Pierre’s financial and estate plans.

Creating meaning in legacy

As part of a comprehensive financial and estate plan, we also worked with Pierre to create a will and assign powers of attorney for him and for his wife. Having these legal documents in place helped to put Pierre at ease, particularly in light of his wife’s health condition. But we went beyond documenting the distribution assets after he and his wife pass away by creating an estate plan that captured his intentions for his family and for the causes he supports.

Pierre also wanted to create a legacy that his family would embrace and continue after he was gone. Towards this end, we sat down with everyone to get a clear idea of their shared values. Based on this discussion, we helped Pierre set up a foundation to be led by his two children and which would support a select group of community-based causes.

The outcome for Pierre and his family

Pierre’s unexpected news created some friction in his family, particularly between him and his son. But the discussions that followed, combined with the creation of the foundation, helped to bring father and son to a better understanding. Both children are scheduled for financial literacy and wealth management education sessions.

While Pierre still doesn’t have a clear picture of his life after retirement – so much of that depends on his wife’s condition – he at least has some ideas about what he might do with his well-deserved leisure time. Just as importantly, he has a comprehensive financial and estate plan that will ensure he and his family will remain on solid financial footing today and well into the future.

We are there for him and his family and are prepared to adapt as circumstances change.  For now, they enjoyed a lovely summer in the Mediterranean and we are looking forward to continue working together.