December 14, 2023
Preserving Multigenerational Wealth:
How to Lead a Flourishing Family Enterprise
Dirk Jungé
Aviva Publishing (2023)
ISBN: 978-1-63618-282-7
New Book Offers Best Practices for Preserving Wealth Over Generations
Preserving Multigenerational Wealth: How to Lead a Flourishing Family Enterprise is the legacy work of Dirk Jungé, a fourth-generation member of the wealthy Pitcairn family. The Pitcairn wealth began with John Pitcairn, a Scottish-born American industrialist who founded Pittsburgh Plate Glass Company, now PPG Industries, in 1883. Since then Pitcairn’s descendants have been growing and sustaining the wealth their ancestor created.
In 1987, Dirk Jungé, a chartered financial analyst (CFA), took the lead in the family business in transitioning it from focusing solely on growing and preserving the Pitcairn family’s wealth to also serving as a consulting agency to other wealthy families to help them avoid the pitfalls the Pitcairn family experienced and also preserve their own wealth. The family ended up reconstituting its old family office as a private trust company, Pitcairn Trust Company, which has since helped a hundred-plus multigenerational families with preserving their wealth.
In this book, Jungé shares the practices he has already shared with numerous clients. His goal is “to pass on to you and your family some habits that can become rituals for your family and, as a result, create, build, sustain, and preserve multigenerational wealth.”
Maintaining family wealth is not an easy task. As generations pass and new ones are born, family goals change and individual family members have different ideas of how to run family enterprises while some individuals may not want to be involved at all. Beyond that is the issue of how to pass wealth on from one generation to the next, whether in lump sums, at the time of a parent’s death, or in increments during the beneficiaries’ lifetime. Jungé addresses all these issues and what he has found to work best.
Whether your family already has multigenerational wealth or you are first-generation wealthy and trying to figure out how to pass your legacy on to your children and grandchildren, this book will benefit you and fellow family leaders. It is also written for consultants and advisors who serve family businesses and families of wealth. And it is written for the younger generations so they can learn and become active in how the wealth is distributed and preserved.
Jungé addresses many family dynamics and how to navigate them to make every family member as happy as possible while maintaining wealth for future generations. For example, he shares how about half of the Pitcairn family members decided to leave the firm to pursue their other investment philosophies or because they objected to the Pitcairn Trust Company serving non-family clients. This difficult transition required sensitive attention to the needs and voices of all family members. Jungé uses his family’s personal experiences throughout the book as a model for other families to learn how to keep harmony in the family and determine shared goals for the family and the future of its enterprises.
Estate planning is one major topic of the book. Jungé walks readers through how to decide who gets what in a family when family members die, which goes beyond wills and trusts to the dividing up of sentimental items. He shares processes for the family to use to help them make these decisions and to retain goodwill toward one another.
It is refreshing to read Jungé’s belief in the importance of educating younger generations from an early age on the value of work and delayed gratification. He describes his own experiences as a child raising vegetables and selling produce and how he learned to be entrepreneurial. He advocates that wealthy families find summer work for their teenage children that is not directly involved in the family business so they learn about work and earning money without receiving special attention because they are family members. As Jungé states, affluent parents need to empower the next generation by teaching them how to earn income. He notes that families who live off the wealth of past generations without working to earn wealth often have scarcity mentalities. Families have to move past limiting paradigms to learn how to earn income themselves and build on the advantages previous generations gave them. For this reason, Jungé states, “it is important to have the young person earn income from others beyond their parents. I had all my kids earn money, learn responsibility, and plan logistics, and they all benefited from the experiences.”
Jungé also discusses how the 4Rs need to be present in family succession planning. Those 4Rs are re-imagining, re-inventing, re-investing, and re-passioning. They should be tenets of ongoing education and training for all family enterprises. He discusses all four in detail, so I’ll only mention the last one, his own term. He believes nothing significant is achieved without passion. Therefore, a family enterprise has to renew its passion by promoting leaders with a passion for facing the challenges of the future and inspiring everyone involved.
Finding and cultivating future family leaders is another key discussion in the book. Jungé discusses how to recognize these future leaders, teach them the rules of governance and family values, and assist them in transitioning into leaders. As Jungé states, succession planning is not an event but a continuous process, so the cultivation of leaders and preparation for the future must always be at the forefront of the family enterprises.
Preserving Multigenerational Wealth is full of other invaluable advice, including how to stay calm in times of crisis, how to determine the most important family values and share stories about why those values are important, the importance of creating mission statements, the role of philanthropy in a wealthy family, how to hold family meetings that are bonding experiences and help family members feel heard and involved, how to create exit plans for family members who want to leave the family enterprise rather than forcing them to stay because if they do, “they will become dynamite on the tracks,” how to create a family constitution and family surveys to determine what the family wants, and so much more. Finally, all the chapters end with a summary of key points and exercises for readers to think further on what they have learned and how it can be applied to their own family.
As Jungé states, money is not good or bad, but wealth amplifies who you are as a person. If people are good, money can be used to do more good. It can also allow you to support bad habits that affect others. Through proper succession planning and using tools to preserve multigenerational wealth, you can ensure that wealth is used for good for generations to come.
There are many more gold nuggets in Preserving Multigenerational Wealth. Reading and applying the wisdom in its pages will be one of the best investments you could ever make for your family and its future.
For more information about Dirk Jungé and Preserving Multigenerational Wealth, visit Amazon.
— Tyler R. Tichelaar, PhD and Award-Winning Author of Narrow Lives and The Best Place
