Handling the transition of wealth

Show Notes

In episode two of the Book of Stories 2.0 podcast series, Charles Stanley’s John Porteous and Citywire’s Ian Horne are joined by Ben Alcock, Chartered Financial Planner at Continuum.

This time around we discuss the transition and passing of wealth between generations, why people do it, and how we can get the timings and the conversations right. There is a lot to juggle here, as we delve into topics like gifting, inheritance tax, cash flow planning, and the life events that encourage people to think about their plans. We also take a look at situations where a transfer of wealth is not desirable.

What is Book of Stories 2.0: An Intergenerational Wealth Podcast?

Intergenerational financial planning is a huge challenge and opportunity, for financial advisers across the UK. In this three-part podcast series, we spoke to John Porteous at Charles Stanley, as well as three leading IFAs, to discuss how advisers can best handle the conversations that need to be had regarding the transfer of wealth.

These musings are based on personal experience, but also on the findings of Charles Stanleys’ Book of Stories 2.0 project. This study is the follow-up to the original award-winning Book of Stories, which examines the various aspects that influence decisions regarding wealth transfers.

In the podcast, we discuss how to engage younger clients and the role that technology can offer in making communication more efficient and effective. We also look at investment trends, such as the shift towards ESG, that might inform the discussions had with clients.

We also look at the fundamental human nature of intergenerational wealth discussions. There is so much to consider, including culture, attitudes towards money, who to include in the conversation, and how to properly assess what financial legacy a client wants to leave behind. Just as importantly, we also account for the complexity of family relationships, and the instances where there is no desire to pass on wealth.

While most financial planners are well aware of the value they deliver, this podcast also considers how we can communicate this value to clients, and how we can introduce new people to the planning conversation. The starting point of the planning relationship is examined too. There are many ways we can be proactive in seeking clients, and there is also good reason to make sure that we respond to client needs during key life events.

With the above in mind, the impact of Covid-19 factors into the equation. Many people have taken this as a prompt to write a will or think properly about how they will pass on their wealth. Equally, peoples’ spending habits have changed, a number of people have relocated, and others have encountered, or opted for, significant changes in their career trajectories.

Taking a step back, we also examine the wider demographic context for current discussions on intergenerational wealth. On a basic level, lives and retirements are generally lasting longer, which can have numerous consequences for intergenerational wealth planning. There are also constant changes in how people interact with and use money to achieve their goals and ambitions.

As a final point, the Book of Stories research is a good read and offers a balance of statistical analysis and qualitative commentary. The stories in the report will be relatable for almost any adviser, and many of the conversations and conundrums will be familiar. The podcast looks to build on this, offering suggestions and anecdotes that will hopefully ensure that clients, and crucially their heirs, have a positive financial planning experience when the time comes to pass wealth to the next generation.