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. Those values provide the seeds for the family's vision of the future. For families with significant resources that have the possibility of lasting through generations, the wealth or the stories behind it 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.
Perhaps the strongest tie holding a family together is its shared story—and yet many family members know nothing about their pasts beyond their grandparents. In fact, if you ask the majority of Americans about their great‐grandparents, they generally know very little, if anything, about them. They usually are removed from current family members by only two to three generations, but in most cases the great‐grandparents' stories are unknown or forgotten by the current generations.
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 a collective experience.
Technologies such as Skype, FaceTime, and others 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 a knowledge of the wealth creation story. They understand that their wealth is not only the assets they possess.
As Daniell and Hamilton say, “Family … is far more than a static family tree of past births, deaths, and marriages. [It] is, in essence, the sum of valued accomplishments, traditions, assets, histories, experiences, lives, places, and memories that flow from the past through the present and into the future.”1
It's clear, then, that history matters. It is a tragedy that so much of it is lost. When working with clients, I sometimes ask them if they are aware of their great‐grandparents' stories—the struggles they had and whether or not they had been able to overcome them. Were there outstanding successes about which they had heard? Do they know the names of all their great‐grandparents' children beyond their own grandparents? The result is too often silence. I then ask, “What do you want your great‐grandchildren to know about you?”
The response to this question is always much more voluble. They want their descendants to understand the toil, the setbacks, the successes, and the joys the wealth creator experienced in providing assets not only for himself and his nuclear family, but also for the family as a whole. They don't want their story to be lost as their great‐grandparents' has been. 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.
In his article, “The Family Stories That Bind Us,” Bruce Feiler cites the work of psychologist Marshall Duke, who discovered that “the more children knew about their family's history, the stronger their sense of control over their lives, the higher their self‐esteem and the more successfully they believed their families functioned….The children with the most self‐confidence have what Duke calls a ‘strong intergenerational self.’”2
When Feiler's article was published, Duke himself took to print to clarify some aspects of his research. In an article for The Huffington Post, he indicated that simply teaching children facts about their families was not enough to make them stronger. “Rather,” he said, “it is our belief that knowledge of family history reflects certain processes that exist in families whose members know their histories. One such process is the communication of family information across generations”3 (Italics mine). In short, storytelling, which can be enhanced by other aspects of family life: traditions, symbols and rituals, experiences, iconography and mottos, and even heirlooms, to name a few.
It stands to reason that families in which the majority of children come up possessing a powerful intergenerational self will maintain considerable cohesion even as older members of the family die and new ones are born. Stories have power, and as they are retold intergenerationally, the power of the stories grows with the telling.
Beyond feeling a strong internal locus of control and sense of connectedness, children who know their family histories also are more resilient than those who don't. This resilience, if shared by the majority of members, stands a family in good stead when hardships arise—which occurs in all families because wealth does not inoculate against sorrow, loss, pain, illness, aging, injury, or just plain bad luck. If all generations have come to learn their family history, they can set those untoward events into a broader landscape and move forward with greater confidence than those who have little sense of who they are and what they stand for.
For example, in an article for the Wall Street Journal, Peter Jaskiewicz and James G. Combs reported on research they conducted on entrepreneurial German winemaking families who had been in business for generations. Among the group they studied, the average winery had been in the same family since the 1700s and the longest winery‐owning family encompassed thirty‐three generations, beginning in the tenth century. The authors identified five traits they felt were essential for entrepreneurial as opposed to traditional families. Of those traits, the first is the transmission of the family history.
“[These families],” the authors said, “have what we call an ‘Entrepreneurial Legacy’ that is passed from each generation to the next. . . . Stories . . . put current risks and problems in a broader context. It is hard to complain about losing a customer knowing your great‐grandparents overcame war and starvation to build the business.”4
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. Yet most wealth creators admit they couldn't have done it without the help and support of a spouse, partner, or even another member of the family. Wealth creation often requires a considerable amount of time away from the family, leaving to others the responsibilities for child rearing, establishing values and rituals, or participating in the community to build the public reputation and legacy of a family. Those stories are worth telling, too.
As the generations rise and fall, they must not be hemmed in by what James Hughes calls the gravitational pull of “the founding dream.”5 While the values of the family may endure, the wealth must serve the purposes of the members who are here today and those who will follow. As Hughes says, “A founder's dream is an extraordinary and impressive expression of human capital…. But [these dreams] by their power may prevent future dreams from being born. In such cases, human capital destroys itself.”6
In other words, the founder's dream may inform the succeeding generations, but it must not dictate their lives. 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.
Very few families' histories feature an unbroken upward trajectory. People are human. They stumble. They make bad decisions. They fall prey to any number of failings, such as multiple marriages and divorces, substance abuse, and even criminal behavior. The family business might have been built on a combination of laudable ethical choices and sharp dealings at the edge of legality.
The less‐than‐honorable parts of the story may make the family squirm, but resilient families soldier on, incorporating the lessons learned from adversity and transforming the corrections into points of pride. Success simply teaches us what we already know, offering little opportunity for learning. Failure, on the other hand, is the point at which human beings begin to acquire new knowledge. Working through mishaps and reversals is the catalyst for growth. A terrible mistake may, in fact, be the cornerstone of a whole new family structure. As Dr. Henry Louis Gates Jr. noted on his PBS series Finding Your Roots, “Untold stories [are] buried in the past . . . overlooked. These recovered stories can, for a new generation, become a source of inspiration and pride.”
Omitting the traumas and tragedies of the family history does damage to the truth and robs successive generations of the lessons of triumph and overcoming—and when challenging events threaten to destabilize a family, those lessons are the most valuable of all.
Today, the proliferation of genealogy websites and the growing number of users attest 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. Whether the stories are told informally around the dinner table or are part of a structured family meeting, real history told by real people brings immediacy to what otherwise might be a dry recitation of facts.
Involving multiple generations in capturing and sharing the family history contributes to long‐term cohesion over a shared past. Some families begin this search for stories by asking the third generation—the ones who may be at risk of being the “shirtsleeve” generation because they are more removed from the efforts it took to build the wealth—to be responsible for interviewing the previous two generations and compiling the stories, which may go back several generations before the wealth creator's personal history.7 Connecting these authentic tales from the elders may transform a lackadaisical third‐generation member into a strong, proud family champion.
Even if the entire family is geographically dispersed, there's no reason family units cannot conduct such historical research and combine their results when they come together to work out the issues of wealth management.
Using these histories, 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? How have these tendencies been manifested throughout the generations? Which values and traits does the family wish to honor and nurture? Which ones need to be overcome for the long‐term health of the family?
Some wealth creators, mindful of the legacy they initiated and wish to see carried on, may decide to make an ethical will. Oftentimes, these documents are videotaped and uploaded so the family has the experience of both seeing and hearing the wealth creator's story and vision for the future.
Different from a will that distributes assets, an ethical will has no force of law. It is instead a simple and direct way for the family patriarch or matriarch to share thoughts, hopes, and dreams with the family. Some choose to write such documents late in life, but they also may be communicated at other times in the heirs' experience. Ethical wills allow the writer to do the following:
Author Pat McNees feels that the term ethical sounds “preachy and legalistic” and prefers alternatives such as “ending note,” or “legacy letter.”8 These descriptions may more fully capture the intent of the document, which is to share stories and values with those who remain.
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. How the information is kept is left to the family. What is most important is that the method selected be secure and easy to use. In many families, one or more family members have an interest in pursuing the family history and not only understand the value of this endeavor but also enjoy doing the work. It's an important role, and those who step forward to manage it should be applauded.
The family history need not be a novel. 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.
If ever there was a family whose legacy runs deep, it's the family of Rose Fitzgerald and Joseph P. Kennedy. The dark filaments of triumph, tragedy, infidelity, and scandal from generation to generation are tightly interwoven with the bright thread of exceptional public service. Although the Kennedys today are no longer one of America's richest families, their legacy of service continues unabated.
The Kennedy dining table, where the day's national and international events were discussed and dissected by adults and children alike, set the stage for both staggering hubris and exceptional accomplishments.
No matter what catastrophes depleted the family—assassinations and plane crashes taking the lives of four of the nine children—the Kennedys reached back into their history to find a way to transcend them. Although they were rich beyond the imagining of many, money was not the reason they survived. What saved the family again and again was a sense of legacy and a feeling of destiny. In the midst of pain, their public life continued—in the House of Representatives, the Senate, and the presidency—and though the current generation is not as active in national politics as those that went before, their influence in public service remains intact. Members of the fourth generation of American Kennedys include Ambassador to Japan Caroline Kennedy Schlossberg, documentarian Rory Kennedy, environmental activist Robert Kennedy Jr., and lawyer Kathleen Kennedy Townsend, the former lieutenant governor of Maryland. Joseph Patrick Kennedy III followed his father into the House of Representatives from Massachusetts, while Patrick J. Kennedy represented Rhode Island. Edward Kennedy Jr. serves in the state senate in Connecticut. The family is a testament to the power of history and remembrance.
Dominic Gardenia* faced a tough decision in selling three car dealerships that his grandfather Louis had founded almost fifty years ago in Springfield, Missouri. He never expected the offer from Autonation*, and when it came through, it was a significantly more than he anticipated. When the transaction closed, the family would receive almost $140 million after taxes. Dominic also believed in his heart that the auto industry was experiencing dramatic changes and it was the right time to sell. Furthermore, none of his children or his brother Rick's* or sister Kristine's* children showed any real interest in being involved in the dealerships.
Nevertheless, he felt the bigger‐than‐life shadow of his late grandfather standing behind him. Louis Gardenia's* life's work seemed to seep out of the walls of each dealership. In 1965, Louis had purchased the first one after working for the previous owner, Tom Fiore,* for almost twenty years. He had started his career sweeping floors and cleaning cars in 1947 after coming to the United States from Sicily shortly after the end of World War II. He barely spoke English, but he was handsome, charming, and persistent—and he talked Tom into giving him a job. During his tenure at Fiore Ford, he did every job in the dealership, finally working his way up to sales manager. Tom treated Lou like the son he never had, and when he was ready to retire, he offered Lou the chance to purchase the dealership. Lou did not have the money, but Tom believed in the man he had mentored and agreed to finance the sale to Lou.
Over the next twenty‐two years, Lou successfully managed and developed his dealership. After it had grown much larger, he bought two more. By 1985, he employed more than one hundred people and had become an icon in Springfield. Everyone knew his television commercials, which were notable for their humor and straight talk. Lou also was deeply involved in his community. He was a deacon at his church, the head of the Rotary Club, and a local leader of the Chamber of Commerce. He loved life and loved his community, and they loved him. When he retired in 1990, his son Vincent* took over as president, remaining until his retirement in 2004. He then passed the dealerships on to Dominic.
To Dom, his oldest grandchild, Lou was bigger than life. Lou was his role model and his mentor. As Dom sat in his office in January 2015, he felt conflicted. How could he sell the business that had meant so much and done so much for his grandfather and his family? It was Lou's legacy, and it was going to evaporate as the core holding and identity of the family. Because Lou had passed away before his great‐grandchildren were born, they knew him only through the occasional stories they heard from Vincent, Dom, and other members of the family. Dom wondered how his children, his eventual grandchildren, and the generations that followed would ever understand the challenges, ingenuity, perseverance, and compassion that had been the catalyst for successful wealth creation.
As Dom was considering this transaction, he sought the counsel of his longstanding attorney, James Forester.* During their discussions of the sale, Dom confided in James his concerns about losing the legacy his grandfather had created and his fear that the current and future generations would never understand or appreciate everything that the family endured in creating this wealth. James suggested to Dom that he consider hiring a firm that specializes in documenting family histories. James had previously referred a couple of other clients to Dr. Susan Radcliff, PhD.* Susan was a historian who started a firm that helped families build archival histories in an effort to help them understand and preserve their family history while also building a legacy for generations to come.
Dom met with Susan and retained her to catalog and document the history of Gardenia Motors. Susan interviewed all the family members and many current and former employees of the company. She also researched all the photographs, articles, newspaper ads, and television commercials. With this great trove of information, she created a comprehensive family history. The process took about three months. Dom was very pleased with her work and finally felt comfortable about moving forward with the sale of the family business.
A couple of weeks after completing the family history, Dom and his siblings called a family meeting to share the details of the pending sale of the business with all their family members. During the meeting, Dom gave each of them a beautifully bound book about the business and the founder. He asked Susan to offer a brief presentation for the family, sharing some of the special stories and significant moments in the history of the business that illustrated the challenges, opportunities, and values it took to maintain and grow the business over fifty years. It was a very emotional moment for Dom and the rest of the family. There were few dry eyes in the room.
This process helped the family appreciate what Louis and the other families had done in building the business that created financial security and opportunity for current and future generations. This understanding helped members of the family bond over the heritage and feel a sense of ownership and responsibility in building the legacy for the future.
If the family history largely has been lost, a similar process can be useful in recapturing it. This history is valuable in forming the undergirding of the family mission statement and in answering the essential question about family wealth management, which will be discussed in Chapter 7.