This question is as benign a question as there is within the realm of wealth planning (my opinion, but stay with me).
Yes, of course family history matters. Plainly. However to what extent?
Does it matter as consequence for family fortune? of course
Does it matter in terms of generational legacy? Obviously
Does it matter to everyone? Nope. Not even close.
My definition of "Does Something Matter" includes the use of communication devices to tell the story and circumstance of something that may prove useful or valuable to the future. Stories, pictures, first or second hand accounts are a part of most of our family stories, however does that mean they matter? It's easy to tell the story of a great uncle, walking home late one night and falling asleep in the ice house, because it was warmer than the outdoors of central Illinois in January, which is hilarious and entertaining, but does it teach me something? Maybe? my family history of creating solutions where none seem to be? or that simply, we are outside the box thinkers? Has to be a moral in there somewhere.
But more importantly and in this case, what "matters" may be transferring a legacy of values or creating a family set of morals communicated by the older generation members to the new as part of a legacy.
Many families do not share stories of risk, triumph or opposition from even a couple generations back. All of us know that generational wealth does not transfer well. In fact, 70% of wealthy families lose their wealth by the 2nd generation and 90% lose after the 3rd. The main reasons are cited as:
- Lack of financial education and stewardship among heirs
- Poor investment choices and lifestyle spending
- Family splits (divorce, having more children) taxes and absence of long term financial planning.
I have to wonder, if we define and communicate what "Matters" more, would this fact change? If we discussed our family history in an open way, can current or future generations change their luck or make better decisions if they knew the mistakes previous generations made?
If something matters, shouldn't we put effort to it? shouldn't we be proactive in the discussion of what we, as a family, have learned over the years? Should we design, implement and manage a series or process of meetings by which the younger family future can dissect and ask questions about how we got here? not just the names of our great grandparents (although that is a solid start), but there decisions, values and legacy?
The story of your past can help you to discover tour family's unique values, shape it's moral purpose and direct it's strategic decision making.
If I can help you have these discussions with your family, please reach out to me.
Remember, it's not what you make, it's what you keep
Phil