Why do families lose their wealth? When authors/advisers Roy Williams & Vic Preisser asked that question of more than 3,250 families, less than 3 percent said poor planning and investments. Some 60 percent pointed to lack of communication and trust in the family, and 25 percent said unprepared heirs. Effective communication is key.
To be effective, family communication must be “adult-to-adult.” By this, we mean that adult children or grandchildren must be able to express themselves and be heard as adults, even when speaking to their parents or grandparents. The keys to doing this successfully have come to be known as the “3 Ps” (so named by Steve Buchholz and Thomas Roth in their 1987 book, "Creating The High-Performance Team"). The three Ps are:
Permission: All individual family members need to be given permission to assert themselves and take the first step.
Protection: All family members need to feel safe in asserting themselves.
Potency: All family members also need to feel that what they contribute will make a difference.
In many cases, wealthy families hire a skilled facilitator to ease this adult-to-adult communication to with the 3Ps. But the principles are something that any family can practice.