The richest person in the world today can teach us all how to prepare our heirs to inherit, even though our assets will be substantially less valuable than his.
Parents often worry that their children are not ready to inherit the wealth that is likely to come. Whether the inheritance is likely to be a few tens of thousands of dollars or much more, parents fear that it will be wasted, mismanaged, negatively change their children or grandchildren, or that the responsibility will be a burden on them.
There are steps you can take to avoid those results.
Bernard Arnault is CEO and Chairman of luxury goods retailer LVMH Moet Hennessy Louis Vitton SE. He is currently ranked as the richest person in the world by Forbes.
For decades, as part of his parental and business duties, Arnault systematically groomed his children to manage or contribute to the business and responsibly inherit significant wealth.
Arnault started early. As the boys grew, he scheduled them to come to his office so he could train them in math between his meetings.
As the children became adults, he claimed that they worked at one of the companies owned by LVMH. She also assigned them to work for other executives she respected who could serve as mentors.
Arnault still has a monthly lunch with all his children where he discusses the problems he faces at the company and asks the children for advice.
Of course, Arnault has also done some significant estate planning. His company shares are now in entities similar to the LLCs that he and his children own. The entities are structured so that the shares must remain in the family for a considerable time after Arnault’s death. according The Wall Street Journal.
Arnault has been practicing the key elements of successful succession planning.
Children learned about money and business early in life and never stopped learning. They have been informed and have been active in the family’s business and financial affairs. They know the business actions their father is taking and why he is taking them.
Children also have the opportunity to learn from others, work outside of their father’s direct responsibility, and develop their own decision-making skills.
Your father’s estate and estate plan will come as no surprise to you when he passes away. They will have had plenty of time to decide what they want to do, learn to work together, and prepare to inherit.