Retired Corporate Executive

Situation: The client is a husband and wife who have been retired for five years, having built significant wealth while he was a corporate executive for a public company. They still hold a concentrated equity position in this company. The couple uses several investment advisors but is not certain that they are getting the results they deserve. The husband and wife have three children and five grandchildren, and they split their time between homes in Tennessee, Colorado, and Florida. He loves to travel. She loves to spend time with the grandchildren. They have good tax and estate advisors in place but are weary of the paperwork, management, and coordination of their financial affairs – and intrigued by the full-service nature of a multi-client family office.

Process: Century Wealth Management’s Guided Discovery process uncovered several interesting things. Both husband and wife had an unfulfilled desire to make a difference in the world – he by providing business school scholarships to his alma mater, she by addressing issues of poverty and abused women. They wanted to dedicate time and resources to these issues, while still maintaining the flexibility to travel and use their homes. Their estate plan, while very well-crafted, required improvement to accommodate their newly disclosed interest in philanthropy. A series of other priorities also emerged during our Guided Discovery process: spending more time with family, outsourcing the tedious, everyday financial tasks, exploring fractional ownership opportunities in aircraft and vacation homes, and caring for an aging parent with chronic illness.

Engagement:

• Helped the client draft a Family Wealth Mission Statement (FWMS), which communicates their general philosophy of wealth, estate intentions, charitable intentions, and investment expectations.
• Using the FWMS as a road map, we undertook a complete portfolio review. As a result, one manager was retained, two were replaced, and complementary investments were added to build out a completely diversified portfolio.
• Worked with existing advisors to craft an integrated estate plan that dovetailed perfectly with the couple’s charitable intentions. This new plan will ultimately generate more wealth for all involved – the couple, their heirs, and their charitable beneficiaries.
• Established a private foundation to fund current charitable activities and engage children and grandchildren in the process.
• Funded a charitable remainder trust (CRT) with low basis stock. The couple will use annuity payments to fund life insurance premiums, while the remaining interest will further fund the private foundation.
• Took over bill payment and bookkeeping for primary and secondary residences, delivering monthly reports on expenses to owners.
• Coordinated activity of property managers and household help at second homes.
• Conducted complete risk assessment – reviewed existing insurance and existing risks. Identified and addressed areas of excessive exposure. Consolidated property and casualty insurance to a central carrier, resulting in better coverage at institutional prices.
• Implemented a mail management solution that enables client to receive a daily e-mail summary of correspondence.
• Designed technology solutions that included Web access to family travel calendars, central document storage, and online investment reporting.
• Initiated the concept of yearly family retreats. Referred family to best-in-class outfitters and travel agents who arranged all the details.
• Researched and made recommendations regarding fractional ownership programs.
• Introduced client to medical resources who could coordinate care for aging parent, including a dedicated medical advocate to oversee care.
• Arranged for the production of a family biography, which included video interviews with the client’s parents.
• Planned and facilitated family meetings, where the Family Wealth Mission Statement was first introduced, the estate plans were reviewed, and specific family goals were set.
• Facilitated ongoing meetings relating to a private foundation and the family’s philanthropic efforts.

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Our family wealth management case studies are based on a combination of actual and hypothetical client circumstances, fictionalized for confidentiality.