Family wealth management: what is it?

As we go through life, our family structure can evolve. People are living longer, relationships change, and careers may shift. All this adds to the complexity of family wealth management, a strategy that can help you to preserve, grow, and transfer wealth across generations.

Family wealth management is an integrated approach to handling different aspects of your family's finances, including wealth transfer, estate planning, tax management, plus more.

In this article, we explore family wealth management in the UK and why it’s important.

Understanding family wealth

Family wealth management is a holistic approach to managing your family’s finances. Wealth can be both enjoyable and reassuring, and by planning ahead there will be less to sort out later in life. You’ll also have the peace of mind that your relatives are taken care of once you’ve passed away.

Family wealth management is all about preserving your wealth and making it last, so it can support your family and future generations. Once your assets reach a certain level, managing them can become complicated, which is why you may choose to speak with an expert to help you. For example, the Financial Services Compensation Scheme (FSCS) protects savings up to £85,000 per individual, per financial institution. Should you have more than £85,000 in savings, splitting it across more than one financial institution means you’ll benefit from FSCS protection.

A Financial Adviser can help you navigate your finances to make sure you’re planning for the future and making the most of your money. This process includes investment management, tax planning, estate planning, and rebalancing your portfolio to align with your financial goals.

Generational wealth

Family wealth management can help preserve your generational wealth. Generational wealth describes the wealth, resources and assets passed down from one generation of a family to the next. It serves as a financial legacy that can take care of your relatives over multiple generations.

Generational wealth can include cash savings, stocks, businesses, property, and other assets that require financial planning. Family wealth management ensures you make the right decisions to protect and nurture your assets for future generations.

Key events to plan for

Below are some key life events that family wealth management services in the UK can help you plan for. These scenarios can give you some inspiration for what to discuss with a Financial Adviser.

1. Children and grandchildren

Your children are your legacy, so you’ll want to make sure they’re taken care of. Likewise, if you’re a grandparent, you may want to leave a sum of money to your grandchildren once you’ve passed away.

Transferring wealth to the next generation isn’t just about money. You’ll want the reassurance that your children or grandchildren will manage their wealth responsibly and know the value of the money that’s passed down to them.

But how much money should you leave them? And what if there are multiple heirs to consider? A Financial Adviser can help you decide how much money you’ll leave for your younger relatives, how to ensure wealth is fairly distributed, and help you navigate sensitive financial conversations with your loved ones.

2. Marriage

Depending on your family’s circumstances, what will happen financially if your children get married may cross your mind. You’ll need to decide if only your direct descendants receive your wealth, or if both your children and their future spouses will receive an inheritance. You may wish to discuss prenuptial agreements with your children, if they decide they get married, to minimise your worries.

It’s also important to consider the possibility of divorce and have plans in place should a marriage break down. A Financial Adviser can support you with these difficult conversations and help you make informed decisions, that benefit both you and your relatives.

3. Retirement planning

Preparing for retirement is naturally a lot to think about. Perhaps you’re looking to travel the world or commit to a new hobby - whatever your plans, you’ll need the right funds to make them a reality.

Finding a balance between enjoying the fruits of your labour during retirement, and fulfilling your wishes once you’ve passed away, can be challenging. A Financial Adviser can help you manage your wealth effectively, ensuring you have enough money for your retirement plans, as well as inheritance to pass on to family members in the future.

Watch your wealth grow, with Flagstone

Flagstone can help you protect your wealth and watch it grow. Our cash deposits platform allows you to spread your money across multiple accounts to maximise your earning potential and FSCS protection.

We’re trusted by leading wealth managers, including St. James’s Place, Evelyn Partners, and Quilter Group, as well as many leading banks and building societies.

learn more: grow and manage your cash with Flagstone