Family Dynamics Flashcards
Only ____% of families sustain wealth beyond the shirtsleeves to shirtsleeves conundrum.
10%
Approximately _____ of family wealth is lost by the second generation.
70%
Williams and Preisser suggest that 60% of wealth transfer failure is due to what?
a breakdown in communication and trust within the family unit.
38% (the highest of any quadrant) of wealthy families communicate and frame wealth in the following way: _______________________________.
low support, high control
14% (the lowest of any quadrant) of wealthy families communicate and frame wealth in the following way: __________________________.
high support, low control
According to the financial, intellectual, social, and human capital model by Jay Hughes, “governance” falls under which category?
intellectual
Key reflections of one’s wealth orientation and skills include the following:
attitudes, behaviors, identity, relationships, language, and approach to money
According to Stacy Allred, the three pathways for estate design include _______________________.
division, preservation, and growth
According to Stacy Allred and others, successful families teach their children the following primary uses of money: save, spend, ________, and share.
invest
According to numerous studies, what percentage of next generation wealth changes financial advisors within 2–3 years of inheriting significant sums of money?
90%
Family mission statements help families make difficult choices when faced with unexpected circumstances by including the following:
goals, priorities, values, strengths and weaknesses
According to academic and educational research, the age range during which children are best able to understand financial and economic application AND are still forming their own opinions regarding such is:
age 7-13
What percentage of high-net-worth individuals in America are self-made millionaires, making their fortunes during their own lifetimes as opposed to inheriting it?
80%
________ ________ includes one’s knowledge, skills, health, motivation, endurance, effectiveness, character traits, experience, etc. (unique to each individual).
human capital
The Jones family is struggling with developing a system or structure to help ensure acceptable stewardship and transfer of their multi-generational family wealth. Which of the following best describes the area or function with which the Joneses are struggling?
family governance
What are considered the four core services delivered within a family office?
advisory, financial planning, strategy, governance
It is not uncommon for next generation family members of significant wealth to feel guilty and/or undeserving of their personal wealth. Oftentimes these individuals develop a heightened sensitivity or focus on philanthropy. This is an example of _____________.
social capital
According to research cited by Grubman and Jaffe, what percentage of parents and adult children, respectively, indicated a desire to get to know each other’s financial advisors?
70%, 60%
The following document is intended to create or develop a shared core set of principles and beliefs of the family unit. All members of the family unit should participate in crafting and feel comfortable with the result. This document also defines actions that the family will take to sustain its legacy in the next generation.
family values statement
Which of the documents below typically: formalizes the family structure and mission of the family business, defines roles and responsibilities, develops policies and procedures in line with family values and goals, and determines the process for resolving family business disputes?
family charter or constitution
Research done by Grubman, Jaffe and others indicates the following challenges and commonalities of many so-called “cross-class” couples of wealth, where one individual (who did not grow up with significant wealth) marries into a family of wealth.
arguments about priorities and spending money, jealousy, sometimes leads to chronic illness
April and Patrick approach their wealth advisor specifically for help with negotiation, resolution, and refereeing. April uses her role in the family to justify power and control while Patrick feels appreciative but somewhat vulnerable. Which of the following family roles (relationships) commonly struggle with these challenges?
second generation cross-class couples
According to research, effective measurement of outcomes is performed in less than ______ of all formal family wealth education plans.
20%
According to Pullen and others, all families with a family business must effectively address the following primary (and potentially overlapping) areas and work through the complex relationships and conflicts that arise from them.
family, business, ownership
