How can families ensure that the decisions they make today will resonate with future generations? Avery Fontaine, head of Hawthorn Purpose for PNC Private Bank Hawthorn, explains how shifting from a “legacy mindset” to a “good ancestor mindset” can help:
“Often, including the rising generation in the family’s decision-making means rethinking how they frame their decisions. We see a marked shift from a legacy mindset to a good ancestor mindset, which simply means they want to ensure decisions today keep future generations in mind.
“A legacy mindset is a two-pocket mindset: My money does two things — it makes more money, or I give it away. There’s a sense that when I give it away, I am making sure that my brand, my name has some import for future generations. I’m telling my story, sharing my values.
“A good ancestor mindset has a one-pocket approach to wealth: my values, my belief system, who I am as a person drive our decisions as a family for all the different ways we can create and deploy capital. All the different ways we can utilize our capital and create more capital are driven by how we view the world, what we think our priorities are. If we have a fairly spiritual or religious viewpoint, for example, that’s going to drive the way we invest, create, give, lend and preserve wealth.
“This is about all the ways we can deploy capital — it’s not just binary. Instead of thinking about brand or legacy as much, values and beliefs are transferred during life vs. conveyed at passing. Give the second-, third- and fourth-generation members daily lived experience. The older generation becomes that ancestor they would like the younger generations to internalize and carry forward. And of course, we often encourage written letters to family members for documentation purposes.”
