Wealth can be a wonderful relief from the many hardships of life. It is what most people aspire to achieve, thinking that life will be completely happy once money is no longer an issue. In reality, becoming or being wealthy is often a mixed blessing, complicating relationships, affects identity, and impacts parenting. Some of the most common issues for wealth counseling include the following:
Jim Grubman works with clients to design effective approaches to these problems in an efficient way. The process often includes facilitating family meetings that improve communication, work out conflicts, and foster successful involvement of the next generation. Other options include collaboration with family advisors, use of psychological or career assessments, and education about financial, medical or legal issues impacting the problem.
Research has shown that, for a surprising number of families, the challenges of wealth are compounded by Attention Deficit Hyperactivity Disorder (ADHD) or related learning disorders (LD). Many intelligent professionals and entrepreneurs have overcome limitations from ADHD/LD through hard work and perseverance. They have been driven to succeed despite distractibility, slow reading speed, restlessness, poor spelling, and/or disorganization. Yet the presence of ADHD/LD can significantly impact one's personal and family life, even as business success grows. Learning and attention disorders can also affect wealth management itself, including relationships with financial and legal advisors. Jim Grubman is one of the few family wealth consultants who understands and knows how to accommodate ADHD and LD as part of wealth management and family consultation.
Family dynamics and wealth intersect powerfully in the area of estate planning. All parties involved have to contend with multiple issues. The elder generation has to balance many competing factors - fairness, generosity, privacy, openness, respect for the next generation's autonomy, desire to hold children and grandchildren accountable for responsible behavior, and not wanting to enable a life without purpose. For the next generation, there are equally daunting concerns such as how to manage an inheritance successfully and how to deal with efforts to control behavior by parents or trustees.
Jim Grubman assists families in working through the dilemmas of inheritance, trusts, and other estate planning strategies. He is experienced in helping clients think through solutions that strike a balance among competing interests. To help families approach the anxiety-producing process of open discussion, he is skilled in facilitating family meetings using good communication guidelines for safe, effective negotiation and resolution of issues.
Jim Grubman has collaborated on a ground-breaking new approach to discretionary trust design with attorney Jon Gallo and psychotherapist Eileen Gallo, the well-known authors of Silver Spoon Kids and The Financially Intelligent Parent, at Gallo Consulting. The new design is called the Financial Skills Trust (FST). It focuses on beneficiaries' skills for handling money responsibly, not on how beneficiaries make choices about career, jobs, level of education, or work ethic that may be desired by trust creators such as parents or grandparents. It supports the autonomy of beneficiaries while holding them accountable for good financial self-management. The FST has many advantages compared to common methods of trust design such as incentive trusts or the use of an ascertainable standard ("health, education, maintenance, and support") for trustee discretion. The principles of this type of trust are part of the Results Oriented Trust Environment™ or ROTE™. The concepts of the ROTE™ have been drawn from the recent trend toward similar principles in the workplace, called the Results-Only Work Environment or ROWE.
The first description of the FST and ROTE™ was presented in January of 2011 at the 45th Annual Heckerling Institute on Estate Planning, sponsored by the University of Miami School of Law. Two shorter articles were published in the April 2011 issue of the Journal of Financial Planning which summarized the problems with attempting to use money as an incentive in trusts (Part I) and the basic design of the new Financial Skills Trust (Part II). Pdfs of these articles are available for download in the For Families: Resources section.
Jim Grubman provides consultation and training about the use of the Financial Skills Trust to families and advisors, either alone or in conjunction with the Gallos.
The primary driver of wealth creation is success in business, often a family business. A family that shares ownership and/or management of a business can reap many benefits unavailable to other families. It also must contend with powerful stresses that can destroy love and create rifts that can last for decades.
A unique set of factors is now converging in the US and around the world: the demographics of the Baby Boom generation, the growth of private equity investing and global wealth, the transformation of the wealth management industry, and the success of many enterprises over the past twenty years. This combination is leading to an unprecedented number of family businesses facing decisions about transferring, acquiring, merging, or selling their business as part of the development of the family's wealth. There are often common areas of stress:
Using a highly collaborative multidisciplinary approach, Jim Grubman works with family businesses and family wealth enterprises to assess and improve these areas of conflict or transition.