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19 of 20 people found the following review helpful:
5.0 out of 5 stars
Sage Advice on Personal Wealth Management, March 1, 2006
With more than 25 years' experience managing other people's money, his personal finances and his family's wealth, Stuart Lucas shares his secrets for building and protecting wealth.
Lucas, a fourth-generation heir to the Carnation fortune, is an accomplished wealth management advisor. In Wealth: Grow It, Protect It, Spend It and Share It, he offers a coherent plan that integrates the vital components of a wealth management strategy.
Departing from the money management classic process, he offers a unique eight-point framework.
1. Take charge and do it early.
2. Ally family and business interests around wealth-building goals and strategies.
3. Create a culture of accountability.
4. Capitalize on your family's combined resources.
5. Delegate, enable and respect independence.
6. Diversify but focus.
7. When possible, err on the side of simplicity.
8. Develop future family leaders with strong wealth management skills.
Lucas says he filters every decision he makes, whether it involves choosing an investment manager, thinking about tax strategy or setting family goals through the prism of these principles.
His discussion equips even the most sophisticated of financial families with an essential, but workable, reference point for their own financial processes.
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16 of 17 people found the following review helpful:
5.0 out of 5 stars
Understanding Family Wealth and Managing It Effectively, March 15, 2006
Everyone dreams of financial ease. It turns out that living with ease takes a great deal of work, dsicipline, and planning. We all hope that we will be able to accumulate enough financial resources to not only take care of our old age, but to provide some things for our children. If our dreams are ambitious we want to accumulate enough resources to change the trajectory of our family's ensuing generations.
We have all heard sad stories of people who attain sudden wealth and how it ends up destroying their lives. Other fortunes that have taken a lifetime of toil to build are quickly lost through any number of mistakes. More than a few entrepreneurs who have shown brilliance in building their company have demonstrated clumsiness in managing their personal wealth. Much of this is due to inexperience and a complete lack of a financial education.
Fortunately, the path of the wealthy has been trod by many and what works is well known. The trick the newly wealthy person has is to become well informed without having to learn about all possible financial mistakes from personal experience. This wonderful book provides a very fine, if not comprehensive, outline of what building, protecting, and sharing wealth means. The author knows from personal experience because he is one of the members of the family that benefited from the Carnation sale to Nestlè and he is also a financial advisor for a living, both for clients and his family.
I particularly like the way the author emphasizes the importance of family with its values and structure in making any plan work successfully. If the family doesn't have a way to plan and work together, then it is really not likely the idea of multi-generational wealth planning will work.
The principles Lucas puts forward in this book are purposely kept simple and present general principles rather than specialized techniques. He puts forward several basic models as frameworks for approaching wealth and I think they are quite good. Each has an approach to investing, risk, and spending based upon the desired outcome. For example, you might not have kids and want your last dollar spent at your funeral. That is different from someone who wants to live off their income from their wealth and give the capital in tact to the next generation. And that is different than someone who wants each member of the next generation to have the same starting wealth in life as the previous generation.
Once the family values are known and the financial goals are set, Lucas takes us into various considerations for reaching those goals through financial management. Obviously, there are an infinite number of possible investment strategies and some are likely to criticize this book because they agree with some specific judgments Lucas makes. This would be an incorrect assessment of the value of this book. The importance of the book is getting a good understanding of what needs to be understood about wealth and capital management rather than any specific recommendation. However, I personally like Lucas' approach.
Finally, he discusses strategies for donating wealth as you see fit and for funding specific things for your descendents such as education, health care, and housing. The book also has a very useful and humorous appendix on the vocabulary of wealth management.
Highly recommended for anyone who is interested in understanding family wealth. A more important topic than most realize until it becomes a crisis. Read this book ahead of time and think about these ideas as you create the wealth and you will be much better off.
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15 of 16 people found the following review helpful:
5.0 out of 5 stars
Use This Book Or Lose It, May 9, 2006
This is mainly about asset management. With the plethora of pieces put out on how to "make wealth," here is advice on how to maintain and preserve it. How assets are managed affects the other aspects of people's lives. "Wealth: Grow it, Protect it, Share it, Spend it," is written for a small audience. But due to coming demographical changes this audience may increase (albeit slightly) in the coming decades.
Lucas's work and efforts in this book will help those who need it. This author was willing to share his positive approach, experience, and expertise with the public. He was born to money, being a descendant and heir of the carnation company.
This is also a book from a financial manager who has experience and is currently involved in several organizations. The focus is for those in wealthy families understandably, with the orientation obviously toward families with significant amounts of assets. This will likely become a more common field of expertise in the coming years to some to degree, and this book doesn't come from an elitist perspective.
Some of the focus is to keep what one already has and safely maintain it, allowing it to grow. In short, don't blow it, nor make mistakes that lead to pain later in life. When it comes to sizable assets and the numerous options of managing and investing them, there can be, and often is - disagreements and disputes within a family - over asset allocation.
As for Lucas, he's basically been managing the funds that were
acquired by the 1985 sale of his family's business (Carnation) to Nestle. Looking at an average inflation rate of say, 3.2% , if someone "diversifies," and consistently monitors their assets they should have no problem getting about, or more than, 5% above the average inflation rate. In addition to looking at computer screens and viewing pie charts and bar graphs, he allocates the rest of his time "serving" on various boards and foundations. He comes across as very down-to-Earth.
His 8 point plan is one of common points we hear today: diversify, delegate, keep it simple etc., This is told by many advisers and planners. But to Lucas's credit he does go into the fine details. Tax planning and looking at long-term goals are also delved into. Of course it's critically important to choose a highly skilled and competent planner(s).
This can be a useful book for those that it applies to. For those that come across assets, we must be reminded that a large percentage of the American public is financially illiterate. How many inheritances, earned capital gains, and hard earned assets have been not only mishandled by the owners themselves, but misused by the investment planner and trustee whose job it was to safeguard them. This is an important book that is very useful.
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