Every family business is unique, much like the individuals within the family unit. There are multiple variables to consider before devising an appropriate wealth management plan. Developing such a plan must coincide with a holistic overview and a thorough understanding of the unique set of variables that differentiates one family business from another.
We understand the complexities of family and family-run businesses and have aligned ourselves with strategic partners to assist our clients with end-to-end solutions that focus on business continuity.
We help families aspire and successfully create a multi-generational system that is geared towards wealth creation, protection, longevity, and ultimately, succession.
“The Three-Circle Model of the Family Business System was developed by Renato Tagiuri and John Davis at Harvard Business School and was circulated in working papers starting in 1978. It was first published in Davis’ doctoral dissertation, The Influence of Life Stages on Father-Son Work Relationships in Family Companies, in 1982. In 1996, the Family Business Review published it in Tagiuri and Davis’ classic article, Bivalent Attributes of the Family Firm.”
Our financial planners will assist you in selecting the right investment strategy. The products we use at the implementation stage include:
Retirement annuities, unit trusts, endowments, living annuities, sinking funds, tax-free savings investments, exchange-traded funds (ETFs), personal share portfolios, structured notes, money market accounts and fixed deposits.
All of these products form part of an individual investment strategy that we compile for our clients based on their personal and unique circumstances.
Our financial planners work within the Three-Circle Model of the Family Business System which typically consists of three interdependent and overlapping groups: family, ownership and business.
We understand that within the family unit there are unique individuals with unique needs, all of whom occupy a particular segment within the Three-Circle Model. We have a mixture of:
Reference: ©Tagiuri and Davis, 1982
Sometimes these three roles overlap within a family business where one individual fills two roles. This is why your Victus financial planner will take the time to understand the dynamics that exist within your family business. By addressing all individuals’ needs, goals, viewpoints, and concerns, we will ensure the shareholders’ liquidity through sound business growth.
From there, an investment strategy can be formulated based on the risk tolerance of the entire family unit and the individual members. This will help your financial planner craft an investment policy to aid the family’s wealth management plan.
“Family money is very different from the cash that individuals have in the bank. Members of successful “Old Money Families” think of themselves as stewards, not owners, of their financial capital. Since they are not owners of it, they don’t feel they have the right to use the money for their own personal enjoyment. Instead, they are just supposed to look out for it, as if it were a piece of heirloom furniture. They might not even like the old thing. They might not particularly like being the custodian of it and regard it as more of a burden than a pleasure. Still, they do their duties.”
A carefully crafted wealth management plan incorporates all variables and emphasises the practicality involved in preserving and managing family wealth.
Understanding how and where to save money is a critical step in this process. This is why it is essential to understand the difference between wealth creation and wealth preservation.
Wealth creation refers to growing one’s wealth or assets through the personal investment of wealth accrued over time, whereas wealth preservation involves safeguarding one’s wealth without any loss of capital.
The following constructs are considered when protecting family wealth:
A wealth management strategy is created based on what has been formulated in the wealth management plan and refers to the implementation phase of the overarching process.
There is a common misconception around wealth management strategies being solely focused on liquid or investable assets. A great deal of the strategy is about managing and reporting back on where these assets are being allocated.
There is no doubt that wealth strategies can be complicated; which is where the Victus team thrives. With our support and guidance, we make the process as simple as possible for you and your family to comprehend.
Like a business, a wealth management plan needs to be fluid in the event of unforeseen circumstances. Once we have formulated and implemented a plan that works for you, the final step is maintaining it.
Each wealth management plan has an ongoing maintenance facility that can easily be overseen by one of our trusted financial planners. You can rest assured knowing that your plan is being fully realised and that business continuity is kept top of mind.
We often find that members are only made aware of the shortfalls and risks within an option when uncontrollable healthcare events occur. We enable our clients to understand all the relevant benefits that a medical scheme can offer, including shortfalls.
We have contracts with numerous medical schemes allowing us to guide, educate and protect our clients, providing the right advice for you to make an informed decision.