The Five Common Mistakes of Next Gen Education Programs

by Elizabeth Goldfinch Senior Manager Elizabeth (Lizzy) is driven to help families and their emerging generations address both the opportunities as well as the challenges of wealth. She works closely with wealth creators and inheritors to understand their intentions and develop strategies to realise their goals across all aspects of their wealth. Lizzy is passionate about helping families find meaning in their money and succeed in sustaining wealth across the generations. Contact Elizabeth

Would you hand your children the keys to the car before they have learnt how to drive? This is the unfortunate position many of the rising generation face when they are thrust, often suddenly, into the driver’s seat of their family’s affairs and asked to manage them without the benefit of a practice lap or a supportive pit crew. History shows this scenario doesn’t end well, with more than 25% of wealth transfer failures caused by ill-prepared inheritors.

Many families recognise the importance of preparing future family leaders for the responsibilities of wealth through education programs. However, far too often we see next gen education programs fail to get off the ground or maintain momentum. Family members become disinterested, disengaged or simply don’t attend. At worst, this can deeply strain family relationships. Why does this happen?

We have found families make these five common mistakes in developing an education plan for their rising generation:

1. The program is too broad

The education plan has been designed for all family members, without taking into account individual ability, interests or age. Asking all family members to meet for an ‘Investment 101’ session when one child is a budding Warren Buffett and the other doesn’t know (or care) what a dividend is will not resonate on either level. There is a role for a whole-family education plan (it may be relevant if all family members are new to philanthropy, for example) but long-term success also hinges on a tailored approach for each family member.

2. It has been developed blind

The education plan has been developed without a clear purpose or objectives. What competencies are required? What skills do family members need and what are they interested in learning about? Once you have this clearly articulated, you can consider ways to make the education meaningful. Tune in to the rising generation’s favourite radio station, WII FM (what’s in it for me?), to ensure the program is engaging and relevant.

3. The content is bland

The plan focuses purely on financial literacy. Whilst this is a vital skill, it is only a small part of the broader picture. The rising generation also need to understand:

  1. Self: What are my signature strengths? What are my values, personality and communication style?
  2. Family: How are we unique? What are our values? What future roles do I need to prepare for?
  3. Individual interests: What lights me up? How am I giving back? What mentors do I have?

4. The delivery is boring

The structure is lecture-style and one-directional. Trying to improve engagement? Make it experiential, interactive and fun! How about a site visit to a not-for-profit organisation you are supporting. Is there a shared project the family can work on? How can family members learn from others by finding mentors or participating in an internship?

5. And the whole thing is a pain in the behind

It isn’t flexible or accommodating. The plan needs to be manageable around different life stages and priorities. For example, it can be difficult for young professionals to request leave from work to attend full-day seminars for family education purposes. Have you considered when, where and how the education is delivered? Also, have you taken a long-term approach to the plan to ensure it is achievable?

Preparing the rising generation is a rally, not a drag race. It’s a process you can start today, but that needs to be cultivated over many years in a thoughtful and planned manner. We assist families and single family offices to combat these common pitfalls by designing engaging development programs and facilitating interactive workshops.

Specifically, Mutual Trust’s Rising Generation Launch Program helps future family leaders realise their potential and prepares them for future roles in family and society. In an Australian first, the Rising Generation Launch Program takes a holistic approach to next gen education, designing individual development plans centred around three core areas – self, family and interests – and providing networking assistance to connect the rising generation with peers, mentors and internship opportunities. If you’re interested in learning more please contact:

Elizabeth (Lizzy) Goldfinch,

Mutual Trust Pty Ltd ACN 004 285 330 (AFSL 234590). Liability limited by a scheme approved under Professional Standards Legislation. For participating members (other than for the acts or omissions of Australian Financial Services Licensees). This information is general in nature and subject to change. It does not constitute tax, legal or financialadvice. We recommend you seek advice specific to your circumstances before taking any action. Copyright © 2014 Mutual Trust Pty Ltd.
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