Purse Strings – May

A Legacy of Our Own

Philanthropy and Legacy Planning Insights
Courtesy of Sabrina Merage, Principal at Transom Family Services

Photo Credit: Kawai Matthews

There is a paradigm shift happening around the world and today, women have more wealth, and the potential to generate wealth, than ever before. Since so many women make decisions concerning their household finances, it’s no surprise that women are also making an indelible impression on the family legacy and philanthropic efforts that will improve the world around them. Whether you are single, married, or the head of your household, you will appreciate these inspirational and informative insights from legacy planner and socialite – Sabrina Merage, Principal, Transom Family Services.

As a second-generation consultant for her family-owned firm, Sabrina Merage addresses the needs and challenges of protecting family wealth for current and future generations on a daily basis. Wiles recently sat down with her to chat about her expertise in training young women to successfully take up the family mantle.

Wiles: What inspired you to start Transom Family Services?

SM: I grew up with loving and supportive parents who would constantly remind me to be grateful for what we had in life. Everything we had and all that my parents accomplished was the direct result of decades of hard work. In the mid-1970s, my father and uncle (recent immigrants from Iran at the time) decided to start a business in frozen food manufacturing. Blood, sweat and tears combined to eventually make the business a success where numerous members of my family joined the team in different capacities along the way. This was the epitome of a family-run enterprise. The business was sold in 2002 and the family members decided to pursue different endeavors but it always stuck with me that the incredible efforts of a family had been able to accomplish so much.

I looked around me and saw that many family-owned businesses suffered due to family dynamic issues, miscommunication and greed. Bottom line, money can tear families apart. I decided it was time to put my experiences to good use by helping high-performing families sustain their legacy in three important ways: 1) strategic consulting for their businesses, 2) training and coaching the next generation to prepare them to take on the family mantle and 3) online reputation management to protect the good name of family members.

Wiles: What lessons did you learn from your parents, especially your mother regarding entrepreneurship?

SM: The first and most important is to take pride in your work and put your all into it. Being an entrepreneur, you are responsible for everything that happens in your business, the success and failures. Celebrate the successes and take the failures gracefully and move on. My mother is an incredibly talented artist who decided to combine her passion in the arts with her keen business mind. She decided to convert a warehouse in downtown Denver into an urban arts laboratory called RedLine, where up-and-coming local artists connect with each other and with seasoned artists through their work, education and the community. It is a one-of-a-kind concept and I am so proud of what she has accomplished. Through RedLine, she has taught me the importance of perseverance, innovation, giving back to the community and integrating love and passion into your work. We spend so much of our lives working, what a shame if we don’t enjoy it!

Wiles: Do you see more women generating wealth, managing wealth and playing an active role in philanthropy; which has traditionally been a male role in most families?

Photo Credit: Kawai Matthews

SM: A study conducted by the Internal Revenue Service in 2005, showed that women comprised 46.3% of the nation’s top wealth holders. 3.4 million women held more than $5.8 trillion in combined assets. This is significant.

There are three main ways I see women getting involved in wealth management and philanthropy. First, with the increase of women in the business world throughout the past few decades, we are seeing more successful and financially independent women as a direct result of their own career accomplishments. Women have taken the roles of CEOs, entrepreneurs and influential politicians all over the world.

Secondly, women who will be the recipients of wealth transferred down by previous generations or from spouses must be prepared to be the next family office leaders. It is estimated that $41 trillion will pass from one generation to the next in the U.S. as 78 million Baby Boomers retire (Source: “Millionaires and the Millennium: New Estimates of the Forthcoming Wealth Transfer and the Prospects for a Golden Age of Philanthropy”).

Thirdly, women age 65 and over are three times as likely as men of the same age to be widowed (Source: U.S. Census Bureau and the New England Entenarian Study, 2000). Women who previously relied on their husbands to handle the financial or business matters find that they must quickly learn to take the reins. I think we are seeing more and more that not only are women capable of being the wealth holders, they are the wealth creators, the philanthropists and the strong voices in the business world.

Wiles: For most women who will not marry rich… what are some ways that they can become independently wealthy?

SM: I encourage women to pursue a career in whatever it is that they are passionate about versus working for the purpose of becoming wealthy. In my experience, those who do what they love will have a far greater chance at success than those who work for money. If you have an idea for a new business, go for it! It can be scary and risky but no one ever succeeded without trying. But if you’re going to do it, be smart about it. Do your due diligence, write a business plan, and consult with experts. Once you have some money of your own, don’t let it waste away in a bank account. Learn about investing and try to grow your wealth that way. Start small, learn as you go and be bold!

Wiles: What are some areas of opportunity for women to better manage their online reputations and personal brands?

Photo Credit: Kawai Matthews

SM: The Internet has become an integral part of our daily lives– from shopping to banking to dating. It is now feasible for anyone to post negative content about anyone online. The reputation of individuals, families, companies, and careers can be ruined by a simple posting on a website, blog, or social network. Women who are high profile or high net worth are immediately targets. It is essential that women be aware of the following:

– If you are using social networks make sure that your security settings are stringent.

– There are some things you should never divulge online, such as your address, birth year and place, vacation plans, password clues, or risky behaviors

– Google yourself! Always be aware of what is our there about you. If you have unfavorable posts, there are people who can help.

– Online predators focus their efforts on young women. Don’t risk being a target by using location-based applications like Four Square or Facebook places. Your online security is part of your online reputation. Take care of them both!

Wiles: How can people without wealth make plans for their family and legacy?

SM: Money is a very small part of the legacy of a family. Values, traditions, and ethical building are equally important factors in keeping a family’s legacy going strong. When working with families, often times we advise them to create ethical wills that communicate a parent’s values to the next generation. These are things like expectations of living an honest and hard-working life, helping others in your community and being a caring, responsible person. We also recommend that families create legacy videos or books. These are documented sources of previous generations that tell the family stories and history of their ancestry. Imagine yourself standing in a river and looking upstream to see your parents, grandparents and the many before you and looking downstream to see your children, grandchildren and children to come. The idea is that we take important lessons and values from previous generations and their experiences, and impart them to future generations to keep the stream flowing smoothly. Wealth does not create a family legacy. It’s up to the members of the family to do that.

Wiles: Outside of a financial legacy what else do you see as a vital component to a family’s success and sustainability?

SM: There are a few fundamental things that many families struggle with: open communication, honesty, trust, support and positive reinforcement. Those families that manage to hold onto their wealth for multiple generations are the ones that are most effective in having open and honest communication with their children about what they should expect and what is expected of them. It is important to communicate to the children that they are not entitled to the wealth, rather they are the custodians of this wealth to grow it, be philanthropic with it and pass it on to their heirs and so on. Also, to foster an environment of shared values and ethics that will survive in the family for multiple generations.

Begin planning your legacy today! To learn more about Transom Family Services, please visit www.transomfamily.com

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