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APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

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Strategic Financial Planning: Secrets of Successful Family Enterprises

An interview with family wealth consultant Dennis T. Jaffe.

| BY Donald Liebenson

It is said a majority of family enterprises go “from shirtsleeves to shirtsleeves in three generations.” But what about the generative families who manage to sustain their family business across several generations? What do these success stories have in common?

"Good Fortune: Building a Hundred Year Family Enterprise," a report written by family wealth consultant Dennis T. Jaffe identifies several qualities that these successful hundred-year families have in common. “I wanted them to look back and think about what the family did to get them through,” he told Millionaire Corner in a phone interview. “What kind of decisions did they make when they got started? What kinds of things did they do to create an environment in which (their wealth could be successful transferred) across two or three generations.”

What links these elite generative families—a term that describes successful families that have sustained their enterprise across several generations—is the nurturing of an enduring family connection. “They made a decision after they had created their wealth and business to invest and commit each other to building the family,” Jaffe observed, “not as a means to greater wealth, but to invest substantial resources from their businesses to develop family education programs as well as philanthropic interests. At the same time, they knew they had to be attentive the profitability of their portfolio, but (their strategic financial planning involved) looking at the business as family members, not just as shareholders.”

Generative families, Jaffe said, also have in place along with a governance structure an ethos of free choice. “Each generation can look at each other and consider, ‘Do we want to be together as partners?’ and have a mechanism for people who didn’t want to be part of the family enterprise.”

Another priority that unites generative families, Jaffe said, is raising responsible family members with an eye on succeeding generations. “Families are always concerned about how to raise children who do not feel entitled,” he noted. “They do this in part with personal development programs that actively engage the next generation and impart family values. They promote understanding about how to spend and not overspend as well as stewardship. (The message is), ‘You can enjoy the wealth, but you are responsible for leaving more for the next generation rather than subtracting from it. All of these families had the basic expectation that members would take care of themselves, learn to do something useful in their lives and not just live off the family.”

One exception, Jaffe noted, was using family resources that would allow a family member to pursue an artistic, social service or philanthropic career.

"They aren't doing these things to make more money," he said. "They decided as a family that this was what they wanted to do with their wealth, to use it to create this family connection and community."






About the Author

Donald Liebenson

Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.  

A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.