Keeping it in the family: here’s how wealthy parents can safeguard their fortune
Many wealthy parents worry about the impact their money will have on their children and how to talk to their children about the family’s financial legacy
History is full of stories of families who amassed great wealth – and then lost it all, often when the children or grandchildren embarked on legendary spending sprees, apparently unaware that their money was a finite resource. For something that is grounded in numbers, money comes with many emotional quandaries. Parents may worry about keeping their children motivated and preventing them from becoming materialistic or acting entitled, or about preserving the family fortune once they have shuffled off this mortal coil. Neo Kgantsi, a portfolio manager at Sanlam Private Wealth, works with wealthy individuals who face such issues. “We invest money on behalf of private individuals and deal with investment vehicles like family trusts, which are set up to look after intergenerational wealth planning – to pass on the family legacy,” he says. “Commonly we see a lack of communication between parents and their heirs. They might hide the money – or the extent of their wealth – from their child...
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