AlTi - Alvarium Tiedemann

Just in Case…A Plan for the Unexpected

By Jill Shipley & Harmony Abney Published September 21, 2023

The reality of life is that none of us know when it will end or if an unexpected crisis, health issue or accident will occur. COVID-19 was a stark reminder of this fact. Families that explore what-if scenarios and put just-in-case plans in place can lessen the impact of a potential crisis such as a health emergency, injury, incapacitation, dementia or worse.

A just-in-case plan is similar to insurance – while we hope our house does not burn down, we proactively plan that it might, just in case. In the same vein, it is critical to have a plan in place to protect your family, your business, and your finances just in case.

Getting Started

It is human nature to desire safety and security, and it can be difficult to think about what could go wrong. Further, facing our mortality can be challenging. Creating a plan and having difficult conversations may be the best thing you can do to help your family, but often, people simply don’t know what to say or what to do. This is especially true when it comes to conversations between parents and their kids about money, inheritance, and estate planning decisions. How much do we tell? What do we say? When is the right time? Who gets what? Who will take over decision making?  How do we prepare them? What if our kids are upset about our plan? What if they take out their anger on us or their siblings?  

The truth is there is no one “right” answer to these questions. Like the proverbial quote the journey is the destination, the process of planning and communicating intentions is more important than the plan itself. There are countless stories of family conflict resulting from the lack of planning not to mention the time, expense, legal bills, and emotional toll of picking up the pieces in the aftermath of crisis.  

Take for example entrepreneur and former CEO Tony Hseih, who at the age of 46 died from smoke inhalation injuries sustained in a house fire. He left behind an estate worth an estimated $840 million – including owning nearly 100 properties in Las Vegas – and no will or estate plan.

‘Queen of Soul’ Aretha Franklin died at 76 of pancreatic cancer in August 2018 without leaving a will. In the following months, her niece was appointed administrator of her estate. She stepped aside in 2020 amid family strife. Franklin’s four sons spent roughly two years squabbling over her assets, including fighting over handwritten wills found in her home.

These are only two cautionary tales, and thousands more exist because advance planning was simply not done. Taking the time to think about and document wishes before a crisis can greatly ease concern for the future. However, the act of talking about money or thinking about and planning for death is extremely difficult and the reason that so many people avoid planning in the first place.

Family leaders start out making all the decisions, and for many years, responsibility rests on their shoulders alone. The idea of the family continuing without their guidance and leadership can seem unfathomable. But not having a plan, and not clearly communicating the plan to all stakeholders, is worse. The presence of significant wealth only magnifies the issues. Without clear expectations, family members can end up destroying relationships, fighting for their piece of the pie.

Be Proactive Rather than Reactive 

If you were incapacitated or unexpectedly passed away, would your family know what to do? If you own a business, would your employees know what to do? Proactively thinking through what-if scenarios prepares your loved ones, and those that depend on you, to implement your plan. An agreement written in good health should outline how to protect the family, the wealth, and the business, from a crisis. While it’s uncomfortable to speak about such things, it’s ultimately best to engage in a ‘fire drill’, in other words, scenario planning and testing for if the worst should happen.

A fire drill entails bringing family members together and putting the just-in-case plan to the test by pretending the current leader/decision maker is gone. For the exercise, the leader remains in the room during the discussion but is unable to answer questions and the family goes through the steps in their transition plan related to the family, finances, and business.

It is important to note that the elements included in just-in-case plans vary depending on the complexities of the family, wealth and/or business, and can often include tough discussions about the health of family members. For example, one component often not planned for due to its sensitive nature is how the family and the enterprise will navigate a concern over mental capacity. We recommend that families and business boards discuss and define what the procedure should be if someone suspects a leader of having dementia. This may include having all executives agree to undergo annual health assessments over a certain age by a trained physician, and if capacity is in question, a second opinion is required. If confirmed, the leader agrees in writing to step down and move forward with the predetermined succession plan.

Building a “Just-in-Case” book

In its simplest form, a Just-in-Case book includes information related to financial details such as assets and liabilities, accounts and passwords, a list of trusted personal and business advisors with contact information, and the location of important documents along with access instructions. Division of personal property such as jewelry, art, collectibles, and family heirlooms are also often included along with stories documenting the history for future generations to understand and enjoy. Taking the time to document how personal assets will be divided amongst family members can go a long way in avoiding conflict or hurt feelings.

Taking it one step further, the book can serve as a storage place for an agreed upon strategy for navigating concern around mental illness, health decline, abuse, or addiction as well as a Conflict Resolution Policy. These are matters that are important for all families and are only magnified when significant wealth or a family business is involved.  

A Conflict Resolution Policy allows the family to come to a shared agreement on communication, including a facilitated forum to talk about disagreements and misunderstandings. Families that take the time to define how they will talk about each other publicly, and what is kept confidential, can often avoid damaging relationships or reputations as well as costly lawsuits. It is much easier and productive to set communication guidelines proactively, while you are getting along versus when an argument or crisis occurs. We encourage families to bring objective, non-family voices to the conversation to function as mediators, to delicately and independently deal with power struggles that can arise.

Handle Hard Better

“It will never get easier, be someone who handles hard better.” These words offered by Duke Women’s Basketball Coach Kara Lawson can be applied to many aspects of life. Just-in-case planning is no easy task, but doing the work now puts your family on the path to handling the hard days better. Take the time to create your just in case plan and communicate it to everyone involved. It is often difficult to think about, but those who put a plan in place today for a variety of possible outcomes down the road are giving their family the ultimate gift – peace of mind.

About the authors
  • Jill Shipley

    Jill Shipley is AlTi’s Head of Governance and Education Practice. She helps families and family enterprises navigate the impact of multigenerational wealth. She brings over 20 years’ experience in family systems, preparing rising generations, communicating about wealth, transition planning, governance, and philanthropy.

  • Harmony Abney

    Harmony is Director in AlTi's Governance and Education group. She brings over 15 years of experience working with ultra-high net worth families, family offices, and foundations, helping them to define the impact they want their wealth to have on their families and the world.

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