Jim Grubman's new book

Jim Grubman's new book

Group News posted in on 1 May 2014| comments
audience: Gary Shunk | last updated: 1 May 2014
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I recently spoke with my friend and colleague James Grubman, PhD, founder of FamilyWealth Consulting (www.jamesgrubman.com) and author of the new book, Strangers In Paradise: How Families Adapt to Wealth Across Generations (available on Amazon here). Jim is a psychologist and a pioneering leader in the burgeoning field of Wealth Psychology. In recent years, the financial service industry has discovered the value of engaging psychologically-trained advisors like Jim and myself to broaden, deepen and refine the services delivered by financial advisors to client families. We discussed his work with wealthy families and wealth advisory firms.

Jim makes a distinction between the skills needed by advisors to serve high-net-worth (HNW) clients with perhaps $2 million to $20 million in assets vs. ultra-high-net-worth (UHNW) clients with significantly more assets, particularly well over $50 million. Fond of metaphor, he compared the complexity of managing “gardens” vs. managing “farmland.” HNW clients are most often individuals and couples who have built up and own what might be a large garden of a few classes of assets, such as a small business, cash, securities and property. In contrast, UHNW clients tend to be families who have built up large assets similar to tracts of “farmland” that must sustain not only the current family but possibly future generations. Certainly both need tending and care in some similar ways. However, the magnitude and complexity of managing acres and acres of farmland compared to a garden require different sets of skills and knowledge for the UHNW advisor. UHNW clients are much more complex: potentially multiple businesses, unique and sophisticated wealth portfolios, domestic and international properties, complicated cash flow, multiple trusts, and the clearest difference: a multigenerational family. UHNW clients are often served by teams of advisors, sometimes within a multi-family office or even a single-family office. Jim’s expertise is in coaching, training, and consulting to those teams of advisors who are responsible for managing the farmland-level of complexity and the very successful families fortunate enough to have resources at that level.

Certainly all HNW and UHNW advisors want to be at the top of their game technically in serving their clients. However, due to the special complexity of the elements associated with UHNW clients, Jim recommends family-office-level advisors develop and refine their “qualitative” knowledge and skills to a very high standard. What are “qualitative” skills and knowledge? These are the “soft-side” skills like great communication skills, the ability to listen, the ability to show empathy, skill in interviewing and responding to multiple family members, even skills in speaking clearly without jargon to all types of clients. Advisors need to be able to explore and integrate into their service offerings the full spectrum of individual and family values, needs, fears, joys and sorrows – the human and spiritual side of owning great wealth,.

Ultimately, Jim’s reference to a high standard draws on the commitment and “curiosity” that advisors need to bring to their work and the families they serve. Years ago I conducted a workshop for advisors titled, “Advisor, Know Thyself.” The essence of this program was a deep dive into what drives an advisor to enter the wealth field. They were invited to look at their judgments about “trust fund kids,” opinions on heirs vs. wealth creators, and their own values around money and wealth. When advisors truly look at themselves, take a deep inventory, and challenge themselves around what they find, they are doing justice to themselves, their colleagues and their clients they serve. Self-knowledge brings mastery.

One of the ways Jim works with advisors (as do I) is the “case study methodology.” This approach may use a realistic but constructed fact pattern for the team to study and learn from in selected topics. It can also take the form of meeting with a group of advisors to discuss a client family they are serving, perhaps with some difficulty or confusion. An open, honest and confidential dialogue about what the advisors are encountering, including personality struggles and failures and triumphs in serving a family, are discussed in an atmosphere of total respect. The goal is to break the logjam in handling the case and move the client services forward in successful ways. The nuanced learning that occurs during these discussions is of inestimable value.

As I said in my Amazon.com review of Jim’s book, Strangers in Paradise, “Becoming wealthy is central to the American Dream. However, when the Dream is achieved, then what? Most books on wealth focus on investing and preserving the money. Strangers in Paradise is very different. The primary concern in this book is on the person and family of wealth. Dr. Grubman carefully addresses how to live with wealth in a whole and constructive manner now and for generations to come. Through rigorous research and his personal face to face work with the wealthy and their advisors, Dr. Grubman has discovered, tested and applied his unique approach with great success. His central metaphor of “immigrants and natives,” guides the reader on a wisdom filled journey into the Land of Wealth. Whether wealth is acquired or inherited, there are many shadowy elements to consider. Strangers in Paradise is a guide filled with solutions to those unknowns. Dr. Grubman is a pioneer and leading practitioner in the field of Wealth Psychology. Whether you are a wealth holder, family member or an advisor to the wealthy, this book is an indispensable guide.”

When I asked Jim what he believes to be the most important process a family of wealth need undertake, he referred to the necessity for families to individually and collectively adapt to the complexities of becoming or being wealthy. As we have all heard: “with great wealth, comes great responsibility.” Often that quote is considered from an external point of view, focusing on managing assets. What Jim challenges families of wealth and their advisors to do is address the much more internal responsibilities of having great wealth. As families establish a clear inner sense of who they are as wealth holders, they will behave from their true center of integrated values, creating accord with the outer world, leading to family flourishing.

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