Wealth Creation: Why the Story Matters

Every wealth creation event has a story behind it, and it is in those stories we find the seeds that have germinated and blossomed into a family history and culture. The stories mean nothing, however, if they are lost in the mists of time. They must be preserved, revisited, and kept alive through family sharing if they are to inform successive generations.

Storytelling itself is as old as human language. Even today, both ancient and modern cultures pass on knowledge through oral traditions. In the stories told from generation to generation, listeners learn and absorb the history, values, customs, and rituals revered by a society, clan, or family. These factors shape the way in which the group makes decisions, defines the world around them, and develops a vision for the future. The individual and collective events and influences of the family create the values of the current generation. For families with significant resources that have the possibility of lasting through generations, the stories behind the wealth bind the family together. Without the context of the wealth history, the family story is about nothing but money. The truth is, however, that wealth is more than money, and history is more than wealth.

In spite of the importance of the family history, when clients are asked if they know their great-grandparents’ stories, the answer is too often silence. They are unaware of their ancestors’ struggles and pleasures. However, when asked, “What do you want your great-grandchildren to know about you?” the response is always much more immediate. They want their descendants to understand the toil, the setbacks, the successes, and the joys the wealth creators experienced in providing assets not only for themselves but also for the family as a whole. They don’t want their story to be lost. They hope the values they espouse are embedded in the family now and in the future. They want to leave a legacy that lasts for generations. They want to make a difference. They want to matter.
 

Society itself can create barriers to sustaining a family’s shared sense of history and identity. Branches of the family may live in different states, regions, and even countries. They may have been widely separated for so long they wouldn’t know each other if they passed on the street. In addition, with the proliferation of social media, on-demand entertainment, and the communication of news and information through personal devices, contemporary culture has become an increasingly individualized rather than collective experience.

Various technologies have made it easier for family members to keep in touch, but these advancements are not always conducive to meaningful dialogue about matters of substance. While it may be true that as a society we have never been more connected, it’s also true that in some ways we have never been less in touch. Although we would not wish to romanticize the past, in earlier times, families often lived in the same cities for generations and their stories and values were well-known to the entire clan.

In spite of these impediments to unity, successful multigenerational families of wealth usually have developed and preserved an ethos based on a strong and well-understood history of the family and knowledge of the wealth creation story.

Uncovering family history and placing today’s family within it is a good thing. The wealth creator’s values and lessons are important in shaping the family’s future goals and mission.
 

By placing the wealth creator’s story in the context of a longer narrative, and by including the stories of those from other branches of the tree, generations of heirs can identify with the panoply of personalities who ultimately produced the wealth creator and come to value each person’s contribution to the greater family legacy.

Today, the proliferation of genealogy websites attests to the fact that people are hungry to know who they are and where they came from. The best place to learn is through the extended family, and the best way to learn is by sharing the stories passed down from generation to generation. Although creating the family tree from a genealogical site is a fascinating exercise in itself, uncovering the stories of the people who came before strengthens the roots, and listening to stories told directly by those who lived them puts the leaves on the tree. Real history told by real people brings immediacy to what otherwise might be a dry recitation of facts.

Using these stories, families can begin to discern the attitudes and values that have been transmitted. Does the family cherish safety, entrepreneurship, public service, adventure, philanthropy, education, religion, a combination, or other characteristics?

Once family stories are recovered, mechanisms must be in place to memorialize them. While many families choose to put the information in writing for easy retrieval, some families place these documents on a USB drive or store them in the cloud. What is most important is that the method selected be secure and easy to use.

The following questions provide the framework for the history discussion:

• What lessons, values, attributes, or opportunities helped the founder create wealth?
• What actions did the founder take to amass wealth? Would the family want to emulate those actions today?
• What sacrifices did the founder and succeeding generations make to create the family fortune?
• What did, or does, money mean to the wealth creator? What does it mean to the rest of the family?
• How closely do our family values correlate with those of the wealth creator? If we have veered away from those ideals, has that distance benefited the family, or should we reexamine the original values?
• Do all the family members subscribe to the same understanding of our legacy?

Focusing on an archival history that includes significant events, influences, and family or business milestones will be very valuable and digestible by current and future family members. The role of family historian is an important one, and those who step forward to manage the story should be applauded.

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This is the second installment of an ongoing FOX series of excerpts from Michael Cole's new book, More Than Money.