Wealthy families with over-privileged children need to consider their assets carefully. Leaving money to a child who suffers from a terrible drug addiction, for instance, could be his or her death sentence. From estate planning to asset protection planning, it is wise to understand the issues around wealth and over-privileged kids, and work to limit their ability to cause problems because of easy access to money. There are a several wealth planning strategies that can be used to insulate the family and mitigate the impact of bad behavior. However, Campbell also notes that “there is diligence and cost associated with setting up protective entity structures, so you want to make sure the cost/benefit makes sense.”
Next, the family takes action to get their over-privileged child help, if needed. Some corrective action should also be taken so the situation does not repeat itself. For example, in the case of drug addiction, the child might go to a rehabilitation center. Sometimes, the families are able to adjust the financials—making it difficult or impossible for the child to access funding when being destructive and harmful. A wealth planning professional should be adept at uncovering your specific needs and goals and bringing the appropriate solutions to the table—either by themselves or via their relationships with expert specialists. They should also explain the pros and cons of each approach. This is where AG Asset Advisory can help. If you find yourself in this situation, reach out to us.
