Private Wealth Report Sets Out 10 Steps to Successful Succession Planning

Jersey Finance is proud to launch its latest private wealth thought-leadership report, Flourishing Futures: Making Succession a Success. 

Written in partnership with top law firm, Bedell Cristin, the report sets out to address the challenges arising from the intergenerational transfer of wealth, dubbed by economists and financial observers as the ‘Great Wealth Transfer’. 

In the next 30 to 40 years, the ‘Great Wealth Transfer’ will see an estimated US$30 trillion of wealth pass down to the present-day generation in the USA alone. 

The report, focusses on succession planning and how existing trust structures, established 30 plus years ago, might be affected by the next generation of beneficiaries.   

Using real-life examples from Jersey’s wealth sector and insights from international private client specialist, Edward Bennett - Partner at Bedell Cristin - it recommends proactive actions trustees and fiduciary service providers can take in anticipation of the increasing influence of the next generation. 

Recommended steps from the report include: 

  • Prepare a summary of the trust structure which explains the terms of the trust in detail 
  • Initiate meetings with the next generation to discuss the trust 
  • Consider how existing structures meet the wishes of the next generation or whether it might be appropriate to establish new structures supporting philanthropic causes 
  • Ensure communication is carried out in a suitable manner. For instance, with the next generation expecting fast, accurate information, does the existing approach sufficiently embrace technology, have the capability to interact via social media or offer an easy online platform? 

Mr Bennett said: “It’s vital trustees and other fiduciary service providers are ready to meet the demands of the next generation. 

“We’ve identified key differentiators between the founder generation and next generation to provide context for trustees and advisors on the situations they may also face in future. 

“Next generation families tend, for example, to spread their wings further geographically, and are more likely to include step-children and long-term but unmarried relationships, whilst not all family members will share the same personal, commercial or philanthropic goals.  

“In addition, those families are much more comfortable with technology - accessing information and communicating digitally, transacting online, managing their finances via apps, or being more open to fintech investment options. 

“The ten clear action points we set out in the report can support practitioners in their decision-making – ensuring succession is a success”. 

Geoff Cook, CEO of Jersey Finance, explained:  

“It is clear there will need to be a certain amount of change and evolution within the global private wealth industry as a result of the Great Wealth Transfer. The indications are that the social, cultural and technological trends shaping the global wealth management sector are giving forward-thinking private wealth professionals a real opportunity to support families with the transfer of inter-generational wealth. 

“Considering Jersey is custodian to a total of £1.3 trillion in assets and has an estimated £400 billion held in trusts established by private individuals, it is clear the impending transfer of wealth, in all of its forms, will be experienced on our Island. Jersey is an attractive choice for the ongoing administration of existing trusts and establishment of new wealth-holding structures due to our stability, certainty and high standards of professional support for cross-border private wealth activity. This sets us apart from other financial centres.” 

The Flourishing Futures report will be presented to delegates at the two-day STEP Global Congress 2018 taking place in Vancouver Canada next week. Jersey Finance is proud to be a Gold Sponsor of this conference, which will explore the major demographic, cultural, technological, economical, political and legal changes that are currently, or will be, impacting private wealth practitioners globally.   

The report is available to download at www.jerseyfinance.je/flourish. Hard copies are available on request. 

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