Sid and Jean started their business out of necessity. He’d lost his job unexpectedly, and the job market appeared slim. So off they went. He was marketing. She was operations. And together, a step at a time, they built a business brick by brick.

Along the way, their children participated in various aspects of the business, but none of them really loved the work. Each carved out a separate career path.

With no one in the family to run the business and no employees ready to take over, Sid and Jean decided to sell. They met with their attorney and accountant, and because of the large capital gains tax they faced, they were advised to gift some shares to their children to reduce the tax liability. The advice made sense to them.

But what they didn’t anticipate was that the business would sell for multiples more than they dreamed. Sid and Jean would never have to work again, and neither would their children.

Each of their children quit his or her job. The two oldest, who were married, immediately undertook building a new house. Their third child quit his job and decided to travel around Europe. Their fourth child dropped out of college and seemed bent on developing new addictions.

Sid and Jean were heartbroken. It was not what they intended. They thought they could give a meaningful early inheritance that would say, “I love you.” But instead it produced a group of non-workers who seemed content to enjoy life’s pleasures without any of the sweat equity they’d had to invest.

They greatly desired that their children be productive, contributing members to society, yet their gift of stock had had the opposite effect. The inheritance did not accomplish their desired objectives for their children. Yet they could not un-ring the bell. They realized they should have questioned further their reason for leaving stock to their children in the amounts that they did.

As I work with families facing decisions around passing on their wealth to the next generations, I find that, too often, the financial side of things gets all the attention. Meanwhile, the vital factors of relational health, spiritual vitality, strong communication and trust, and a shared family purpose are ignored or given minimal attention.

Here’s a clarifying question: if your family could only pass down one thing to the next generations, what would rank at the top of the list?

Bill High

Bill is CEO & Founder of Vyne Legacy. He works with families to equip them with tools to build multigenerational legacies, and he teaches givers and financial advisers on transformational biblical generosity. He is the co-author with David Green of Giving It All Away and Getting It All Back Again: The Way of Living Generously.

Published February 5, 2018

Topics: Estate Planning

Estate PlanningFamily BusinessHeirsInheritanceReadiness