As chief learning officer at the Denver-based Johnson Financial Group, Kristin Keffeler works with families, next-generation members of family offices and advisers on motivation, behavioral change, family dynamics, governance, education, development and intergenerational collaboration. Kristin is the author of The Myth of the Silver Spoon: Navigating Family Wealth & Creating an Impactful Life and co-wrote Wealth 3.0: The Future of Family Wealth Advising in 2023.
How did you begin to work with family offices?
My father is a wealth creator. He founded a company, took it public and sold it when I was going to college. I spent a lot of time with estate-planning attorneys, financial advisers and tax people. I showed up meeting after meeting waiting to learn what this all meant to me. Instead, I walked away after every meeting feeling not that intelligent.
I was working in health and productivity management in Fortune 500 companies. At the same time, I thought a lot about what it means to be a good steward. I was trying to find my own voice in our family and how to integrate family wealth into my narrative while living my own life. That led me to work with other rising-gen family members to help them build business, life, beneficiary and financial skills to have a seat at the family decision-making table and also be in the driver's seat of their own lives.
What are the biggest challenges you’ve identified for second-, third- and fourth-gen family members?
My own experience mirrors that of many other second gens, which is different from third, fourth and fifth gen. My Dad was successful, but he didn't have wealth events until I was a young adult. I left home when this was happening, so I didn't grow up with wealth.
That's not atypical for people who are second gen. Their parents are in building mode when raising kids, and the wealth event comes later. Fundamentally, there’s a core set of skills needed to adapt and be effective in the family: How to budget, how to live within a budget and how to make decisions. Before those skills can be built, there has to be the inner work of learning to be an individual, forming an identity separate from the family and being a part of something that often feels bigger than yourself.
How well is this work addressed by family office advisers?
It’s often outside the lanes of most family office professionals. I worked with a young woman whose parents created a company worth more than a billion dollars. She was the sole heiress but lacked the ability to make decisions about her own life — what apartment to rent and what car to drive. Her parents kept very tight purse strings. We worked on building her skills to figure out what it cost to live and create a budget. As long as her parents made those decisions for her, she would remain a child. Some of these are tangible skills, and others relate to family dynamics.
What inspired you to begin writing books about wealth and families?
I got my master's in applied positive psychology and researched family office members who were at the top of their game to understand common character traits and skills to apply a strength-based approach. The book is a framework that can be more broadly used.
Your book talks about the hidden tripwires of inherited wealth and the clutter that family money can bring. Can you give me an example?
Identity experience is fundamental for healthy development, regardless of wealth. It’s the ability to build your own identity, understand yourself as an individual separate from your family of origin but also connected to your family of origin. Wealth creates a compounding factor that can stunt the process, because usually with money comes power. Over-identification with the family makes it nearly impossible to have the courage to try something outside the family business or even succeed inside a family business.
The sweet spot is the ability to know who you are. You can be present and engage, -but not lose the core of your identity. The book deals with this kind of psychological and emotional clutter that wealth can create.
Why family offices need to think about crisis management
By APRIL RUDIN
In a perfect world, our families would be completely safe all of the time. But sadly, this is not true. We all balance risks, from physical hazards during travel overseas, to a family member’s addiction issues, to vulnerability online. We can only take the wise advice of planning for the worst while hoping for the best.
When it comes to family offices and money management, these risks may not always top the list of discussion points, as they get drowned out by investment talk. That’s where companies like mine come in, using our experience working with high-net-worth investors in financial services to form tangible plans for reputation management and crisis communication — so that when the worst does happen, you are prepared.
How does one even start tackling crisis management?
- Identify what worries you and your family. Is it a broad risk, such as cyberattacks? Or is it more specific, such as an online teenager’s being vulnerable to sextortion? The list could be broad, and it may be long. The important thing is to discuss it and be honest with yourself and your family.
- Develop a messaging platform and response protocols. If a threat becomes a reality, a family should be ready to move quickly and earnestly. Each family member should know his or her role and understand how the family wishes to communicate and handle the situation with a unified front.
- Monitor and adjust the plan. Risks will change with time and circumstance. It is important to continue to assess potential risks before they arise. Additionally, you need to keep abreast of the news and monitor any mention of your family members, companies or related entities.
- Understand the role of the media. Media can be a tool for good or a weapon to be wielded, depending on how one uses it. The same goes for social media. I have found that the appropriate public response to a given situation will depend on the message one wants to get across. But whether it is silence or open communication, the response will be a poignant one.
One only needs to look to Britain’s royal family to see divided examples of crisis management. King Charles and “The Firm” have navigated crises in their family and in the eyes of the public in addition to the usual risks faced by wealthy families, such as vulnerability to compromising photos being published or threats of physical violence. The king’s son Harry and his wife, Meghan, have famously taken on their own messaging and managing of risks. Each side’s approach best reflects their own situations. Both Charles and Harry have tried to assert control — of the message, the public perception and their livelihoods.
The risks facing high-net-worth individuals and family offices are unique and will present challenges that require well-thought-out responses and an understanding of the sensitivity needed to navigate delicate situations. The best-managed situations are ones that you will never hear about or notice, while disasters and floundering responses to a crisis will at best result in reputational damage and at worst cause physical or mental harm to a family member.
April Rudin is the founder and CEO of The Rudin Group, a New York based firm whose communications experts design marketing campaigns for some of the world's leading wealth management firms, fintechs and family offices.