Living Long

MCF Intersection

A regular snapshot of the trends, news and research in the world of philanthropy — and its impact on business.


The impact of greater longevity will be broad and deep.

The average life expectancy in America today is longer than in any other period in history. The systems and structures that support our lives will also change. The way we define family will continue to evolve. The way we plan and build the infrastructure of our cities will be rethought. The demographics of the labor force will shift. The need to rethink our healthcare system and reduce costs will increase. Educational institutions will be redesigned. Our expectations for retirement will be redefined. Even our social contract will change. 

More Living Generations Are Sharing the Wealth Than Ever Before

Families of wealth won’t be immune to the direct cost implications resulting from a higher spend rate for lifestyle and healthcare. The lifetime cost of disability issues will also become much more significant. The indirect costs will also hit families of wealth as taxes will rise to fund the overall cost of longevity. Multigenerational wealth issues will also become more complex. With not three or four but four or five generations sharing the wealth, staying together as a family enterprise might prove too challenging for many families. Therefore, guiding families through complex governance systems, successions or perhaps orderly separations will become increasingly needed. Conventional wealth planning may not sustain the stress of multigenerational issues, and families may need help revisiting and adapting their planning.

Family philosophies on the purpose of the wealth are likely to evolve, driven by various multigenerational aspirations. We’re already seeing a fundamental shift. The previous family wealth model was typically meant to preserve the wealth for future generations. The new model is increasingly about putting money to work in the wealth owner’s lifetime.

The goal for many modern wealth owner’s is to have an impact on their children, philanthropy, fostering a generation of entrepreneurs or other causes they care about, in their lifetime.

Ideas for Clients to Consider as They Think About the Impact of Longevity:

  • Develop a Longevity Strategy: Make managing longevity challenges and opportunities an integral part of your client’s purpose and vision; explain the benefits of giving his advisory team permission to partner with him in identifying the strategy. A true multigenerational advisor who can help develop a longevity strategy for clients is an extraordinary value-add and helps address issues related to this “elephant in the room.”
  • Communicate Wishes: Aging and death and the issues associated with them, such as end-of-life care and funeral plans, are sensitive topics for clients and taboo in many families. However, to be able to lead the development of a longevity strategy, the client needs to be able to discuss issues related to longevity openly with his family. Someone needs to raise the topic, be courageous, and share stories to convey the implications of poor versus adequate planning. Engage elderly clients and their children. Make longevity an ongoing topic discussed, along with family enterprise goals. The two go hand in hand.
  • Rethink Planning: Family wealth owners have to re-engineer their planning to sustain the test of a 100-plus year life expectancy. It’s very likely that wealth preservation alone won’t be enough to sustain the wealth through generations. Families will need to generate new cycles of wealth creation. New structures, around governance in particular, might need to be considered. The older generation might need coaching to find their future role and relinquish control. Or, if increased longevity means staying together as a family enterprise is not sustainable, then separation planning will be needed.
  • Enhance Risk Management: Families need a forum to discuss the implications of longevity as a whole group. A family risk body of some sort will ensure ongoing discussion with all generations. Such a forum will also serve as a safeguard in the event that potential legal situations arise. Potential legal conflicts need to be thought through ahead of crises.
  • Role of Advisors: Advisors also need to mitigate risks associated with longevity by helping other advisors think of risk holistically across the family enterprise and by fostering communication among advisors to bring an integrated approach to longevity planning.