Commonly in Western society, we believe that the good practice of the only preserve financial assets, the things we have, is the main objective. While this is certainly a very important goal, of course, it is not the only one.
It has been carefully mentioned in previous writings, that wealth is created and destroyed often within three generations. As James Hughes site in his book, "family property", the old Chinese proverb is "shirt shirtsleeves in three generations." To explain further, the existence of wealth occurs in three stages within a family.
Along with this physical, the first step is the creation that occurs in the first generation wealth creators. These are often "mom and dad" creating wealth, usually through a successful commercial enterprise.
The second stage is the stage of stasis; deadlocked step or what can be considered a point of equilibrium in which maintaining or preserving the relationship.
Then finally, the existence of matter, or in this case wealth, moves in a state of entropy or decomposition. If they are not properly cared for, wealth begins to disappear or transferred outside the family. This usually occurs with the third generation, or at least has a reputation for doing so, as the third generation is far removed from the concept and the requirements needed to create wealth in the first place, also known as "cradle syndrome of gold".
The question is how long the family can maintain their wealth and make them last preferably in the first stage of creating generations?
The first step is to recognize that there is more than one type of wealth in a sustainable and healthy family. Wealth, class that is vital in a sustainable strong family for several generations, comes in three forms: human wealth, intellectual wealth and financial wealth.
Human wealth is related to the welfare and happiness of a family member; the floor with purpose and strength in their own identity and sense of freedom. Often, one of the challenges of an individual inherits a considerable wealth is they know they do not work for it or create it first. Along he has no idea what it really takes to create wealth, they know they do not earn and can form a guilt complex.
Another result, which is common to the second generation, is a sense of obligation to preserve, where you have to do as a lawyer or financial advisor. However, among the beneficiaries of significant wealth, life can become very annoying in some respects. Very often, these heirs may ask why her friends really like - they're just in love because of their wealth? This can create insecurity.
The point is that human wealth is an essential form of wealth that should be given a family environment to grow and thrive, and to maintain and build a sense of purpose. Therefore, like any successful organization, the most important family asset is its people and success, growth and happiness of its members. Therefore, the physical and emotional wellbeing should be a priority.
The second form of wealth within the intellectual wealth of the family. intellectual wealth can be described as the construction and maintenance of knowledge, creativity, skills and experience to support and promote the welfare of the whole human family and financial wealth.
Although difficult to quantify, intellectual wealth can be measured by the success of each individual, whether academic, artistic, professional or business related, or interpersonal. This intellectual capital is also necessary that the individual family members to preserve and develop the financial capital. In fact, it is essential for both human and intellectual capital of financial wealth to survive in a family for generations.
Without proper planning and family governance structure, the three types of wealth, human, intellectual and financial wealth will not survive. Therefore, the saying "shirt shirtsleeves in three generations" materializes. A good estate planning and legacy must be carefully designed and structured to preserve the three forms of wealth.