I was recently part of a discussion on topic of new risks facing the wealthy conducted by Attorney Patricia M. Annino of Boston MA.
As she highlights, families and family owned businesses are not only subject to the traditional risks in advanced planning such out of date business and estate planning documents, liquidity, divorce or remarriage, lack of effective communication among key stakeholders, for example but also for new risks that are born by social media, Google, globalization, the speed of innovation, pre and post nuptial agreements, attacks by the IRS, and turbulent economic times to name a few.
Just last week we saw Michael Dell’s teenage children on their way to Fiji, tell the world through Instagram and Twitter where they were jetting off to, what they were eating, and gave the location, time and date of where they would be in a few weeks time.
How did Michael Dell deal with this issue?
Dell did something dramatic. He took down his teenage children’s social media pages. Even at the annual cost of $2.7M for security protection, which includes virtual oversight, it isn’t enough to protect his family’s privacy from his own children use of social media. How many clients do you know that could be in this very position?
Too many I suspect.
What as planners should we do to help mitigate these risks or at a bare minimum to educate our clients so that they can begin to take action? We can help clients manage these new risks to family cohesiveness, business ownership, and wealth management by the creation of a Risk Management Policy Statement as Patricia suggests and add value to our relationships beyond the plan design.
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