Wealthy Families Are Writing Mission Statements to Avoid Fights, Lost Fortunes
Advisers help families spell out their values for generations to come
- Wealthy families are increasingly using mission statements to preserve wealth and family cohesion across generations.
- These statements, while not legally binding, aim to prevent disputes and ensure younger generations manage fortunes responsibly.
- Advisers like UBS and J.P. Morgan Private Bank assist families with assets typically exceeding $50 million in crafting these declarations.
Serial entrepreneur and investor James Harold Webb has done careful investment and estate planning to pass down his wealth to his five children, their three spouses, and six grandchildren. He also got everyone together to write a family mission statement.
“The entire goal is to preserve the family and to preserve the wealth,” said Webb, 65 years old, whose ventures include buying and building 33 Orangetheory Fitness franchises in Texas that he sold to private equity.
The mission statement for his 16-person blended family: “Life is a gift that cannot be wasted. Family is the essence of that life and, as a family, we will work hard. We will play hard. We will live in the pursuit of knowledge. We will love our family unconditionally. We will give more than we take to ensure a better world.”
A family mission statement lays out principles and goals in a few sentences. The aim is to avoid the fighting that has destroyed fortunes and left relatives battling in court, or just make sure younger generations don’t squander the fortune.
Behind the trend is the extraordinary wealth creation in recent years and a boom in family wealth and concierge services catering to it.
Sometimes known as a declaration of purpose or vision, mission statements aren’t legally binding. Some advisers embrace the statements as a way to increase a family’s chances of what they consider success, preserving their wealth for a century or more.
Advisers point to Gilded Age dynasties that have disappeared to warn about depleted fortunes and families that no longer are connected. Wealth advisers like to reference a 2023 book written by Victor Haghani and James White, “The Missing Billionaires,” which notes how rare it is for great family fortunes to last beyond a few generations.
Some families opt for a more robust, legalistic document, called a constitution. For families that own businesses, constitutions can lay out what minimum requirements family members and their spouses must meet to be able to work at the business. To try to avoid drama later, they also can define who even counts as family, such as stepchildren.
Some family members put the mission statement on the back of their business cards or hang them, framed, on a wall at home.
“It’s going to be the family’s why. Why are we doing what we’re doing? Why are we making all this money?” said Shawn Barberis, whose firm, More Than Money 360, works with families including Webb’s to create mission statements and prepare the next generation for leadership. “Every family gets off the tracks a little bit and it can get them refocused.”
Webb was born to teenage parents in rural Mississippi. He says he is astonished that he has been able to create what he calls “generational wealth” for his family, including from a medical-imaging business he sold in 2017 for $94 million. He and his wife, Cathy, split their time between Frisco, Texas, and San José del Cabo, Mexico.
Webb and his wife, plus the children and their spouses, sat around a conference room at a Frisco hotel several years ago to come up with their mission statement at the encouragement of Barberis, with whom they’d started working several years after they got married. With Barberis guiding the discussion, Webb and his family spent a few hours talking about what was important to them to brainstorm their mission statement.
Webb now kicks off his family’s annual meeting by reading the mission statement aloud and leading a discussion of whether it needs revision. Then, he updates the family on his finances and estate plans before they break for games and a meal.
The mission statement by itself isn’t enough to hold the family together long-term, Webb said. But, coupled with transparency and financial education, he figures his family has a shot at maintaining its wealth for generations.
At UBS, which has a big business advising wealthy families, Sarah Salomon, head of family advisory and philanthropy, and her team help families that typically are worth at least $50 million write mission statements. They’ll often kick off discussions by handing each family member a pack of cards inscribed with words such as “curiosity,” “reliability” and “spirituality”—and asking them to choose the cards that resonate with them the most.
Advisers sometimes have family members look at a series of images and riff on what they see. A photo of redwood forests, said Elisa Shevlin Rizzo, head of family office advisory at J.P. Morgan Private Bank, has prompted themes of permanence and environmental stewardship.
“If we know one of our core values is stewardship and legacy, maybe we don’t use the trusts for current consumption to fund extravagant lifestyles,” Rizzo said.
Colorado vacation homes and luxurious Airbnbs in Utah are popular sites for brainstorming mission statements, Salomon said. She typically steers clients away from offices, preferring settings where family members can relax and reflect.