The theory that skillfully addressing family dynamics makes the legal and financial sides of wealth planning more effective has become almost universally accepted in multi-generational wealth management. In fact, the Institute for Preparing Heirs has found in its field work that most wealth transfers fail in spite of excellent tax and estate planning.

“Sixty per cent of the time it’s because of lack of trust and communication in the family and 25 per cent of the time it’s because of unprepared heirs,” says Shipley. “So to me, I put that together and say that 85 per cent of the time that families are failing to accomplish their goal at passing wealth onto their children it’s because of an issue with communication.”

Because of this, the next gen program that Shipley runs has communication at its heart. But even as the industry has come a long way in addressing this, talking about money in society – and even within families – has been such a longstanding taboo that real change is slow. And there are obvious consequences of this.

Failing on financial education

“When it comes to looking at the next gen I think one area where we really fail our young people is in preparing them to manage their personal finances,” says Shipley. “Parents aren’t teaching children and schools aren’t teaching children.” Finance has become more and more complex over the years, and education has not nearly kept pace. “They , and everyone has a right to do what they want with their life and with their wealth…but as advisors we have a responsibility not just to placate our clients but to share with them the best practices.”

However, she warns against advisors becoming embroiled in deeply dysfunctional family relationships, referring to Keith Whitaker and Susan Massenzio’s “traffic signal” theory of functionality (as expanded on by James Grubman and Dennis Jaffe in Private Wealth). While advisors can bring families together they should refer clients to experts when it is called for.

Overall though, one of the things Shipley is most optimistic about is the way the wealth management industry has latched onto the concept of family dynamics and is pioneering ways to account for this within the wealth planning process.

“I have to tell you, I love what’s happening in our field. I love the recognition that the soft stuff in families is the hard stuff,” she says. “There has been such a significant shift in the openness…Even the idea of sitting down in a family meeting has become much more comfortable, and I really credit a lot of the leaders in this industry.”