WEDNESDAY, FEBRUARY 21, 2018
JIM: You have heard the story of the Vanderbilt family who was once one of the richest families in America that had a family reunion 100 years after the wealth creator’s death, Cornelius, yet there was not a millionaire among them; yet the Rothschilds have been passing wealth down from generation to generation. The difference? Family communication. Today we are joined by Jeff Lanza, retired FBI Special Agent and the author of PISTOLS TO PRESS: LESSONS ON COMMUNICATION FROM AN FBI AGENT, and spokesman. He’s going to share with us how to apply some basic principals of communication within your own family to help you have a successful transfer of wealth. Welcome, Jeff.
JEFF: Hey, I’m glad to be here. Thanks for having me.
TONY: We really appreciate you joining us today. You’re a communication expert. I know at a presentation I just recently saw you at, you mentioned that communication has a big impact of wealth transfer. Can you maybe talk about what impact does communication have on wealth transfer.
JEFF: As I was preparing for the presentation that you saw, I was going through some of the important aspects of communication in a more general sense, a financial advisor communication with their clients, but also there’s lots of research I came across that shows how important communication is and passing on family wealth and the transfer of wealth, the communication within families. Several of the pieces of research that have been done stress that communication is such an important part of building trust, and trust in turn then is an important part of preserving the wealth and successful transfer of wealth into family. So it really relates to the key points. You can’t have trust without good communication. Good communication leads to trust which leads to successful transfer of wealth and harmony within the family during that transfer process.
TONY: That’s a great point because as planner, Jim and I have guided families for many decades as far as the transfer of wealth. It’s amazing how sometimes the, what’s called the older generation today, didn’t take a lot of time – and this isn’t true everywhere, but in general – didn’t take a lot of time to really talk about money as they were maybe raising their kids or as they aged to inform the children of what’s in place. We try to endorse having family communication, of course, at the design level. When mom and dad are doing their estate planning, it’s really important to incorporate the kids. You don’t have to tell them where every penny is if that’s what you’re concerned about, but giving the message to the family that you’re doing your prearranged planning, and not just the funeral side of things, but the distribution of wealth. We always hear from the kids that say, man, there’s just a sense of relief that mom and dad are doing this kind of planning, whether that’s wealth transfer or asset protection because of the concerns about healthcare and long-term care. I think just relaying to the family members that you’re going through this process and building a foundation that will help in the transfer of wealth. It’s essential. Give our listeners a little, I guess, an extra kick in the you-know-what, to be motivated to do this because there’s noncommunication. I can’t image there’s a long benefit list on that side of the equation.
JEFF: Absolutely. Here’s where the problem is. A lack of communications causes a problem because people tend to fill in then the missing information with wrong preconceived notions are, and of course, it may not be accurate. Then that becomes what they believe, and if they’re not getting good communication about wealth, about transfer, about what’s being done, then they start to assume things. You know what happens when you assume. It’s usually not the correct information, and then you may take action based on that inccorect information, you may assume things that cause mistrust. What communication does, open communication within the family, is it first of all brings a shared vision and mission to the family and it creates a sense of harmony and it eliminates that rumor, that innuendo, the things that you have in your brain that you’ve kind of made up from the lack of communication. I think it’s such an important part of just; the whole process is starting with communication.
JIM: It’s probably not more true in a circumstance, like a lot of times we’re dealing with small family businesses. Because of that, not only are people making decisions about that, because a lot of times you may not have all family members involved in that business, maybe it’s just a couple of members that stay behind in the business. The ones that are not in the business are not understanding the work that’s involved and the sweat equity, and there are misconceptions about the value, and if there’s never any communication then they have the spouses there to help feed sometimes that miscommunication or misunderstanding. We usually start our meetings when we do a family meeting. I always tell people my goal is that you can around the holidays wish people a Merry Christmas or Happy Birthday and mean it and still have those communications when mom and dad are gone. Maybe talk a little bit about how important that communication is in that business or transfer of a business situation.
JEFF: Surprises are never a good thing in terms of the information that you receive. It’s good to know up front what the deal is, especially with a business, as you mentioned. Now I had personal experience with that because my dad was a small business owner and I was very involved in that operation in that business because I left to go to grad school, before I joined the FBI and kind of left the business at that point in time. I had four brothers. We communicated very often about the business. In fact, we got together, not just to talk about the daily operations of the business, but what’s going to happen when my dad decides to sell the business. This wasn’t talked about just at the last couple of months before he was getting ready to retire. I mean, we talked about it all the time – the value of the business, how it was going to be split up, what’s going to happen in terms of his retirement. You mentioned sweat equity – oh, that’s just so important, because I worked my tail off in that business for a number of years, through my teenage years. My brothers, some of them were not as involved as I was, so they probably didn’t have a feel for that, but that’s were communication comes in at family meetings which you should have on a regular basis to discuss these type of things, especially when a business is involved.
TONY: That’s a great point. Again, we’re big proponents of the family meeting. Other than let’s say the advisor who would conduct that meeting, any tips from your knowledge and experience as far as how that meeting can be constructed? Like Jim kind of talked about, you want everybody to really still be family to kind of leave with a positive from that and gain from it versus creating problems. What would be a most effective way to kind of structure that family meeting?
JEFF: The first thing with any meeting, nobody likes meetings, but with any meeting is to get people to buy in for the reason for the meeting so they know why they’re there, that they know what’s going to be discussed, and once they agree to that preconceived notion then you’re more likely to get a positive outcome. If people don’t want to be there, if they don’t understand the reason for it, it’s probably not going to go good. That really comes from the leadership in the family and setting up the standards and the idea of this communication and this trust process. I think from a family meeting perspective, you’ve got different generations. You kind of alluded to that a little bit earlier. What language are these different generations talking? My parents don’t communicate in the same way that my kids do in terms of the communication technology, in terms of how they see things and perceive things. In setting up the meeting, there probably needs to be an understanding of that and how we’re going to communicate within the generations.
JIM: Can you share with us some of the tools that families can incorporate to know that they’re having effective communication, because of a lot of times people are talking, nobody’s listening, or they’re not hearing the right thing or they have misconceived ideas. What are some of the tools or techniques to make sure that that communication is effective?
JEFF: Testing for understanding is one of the best tools, and it’s not a high tech tool, it’s just asking the right questions to make sure people are understanding what’s being said. Mark Twain once said that if we’re supposed to talk more than we listen, we’d have two tongues and one ear. People like to talk. People like to think about what they’re going to say next in a conversation and then because they’re doing that they’re distracted and they’re not listening to what someone else is saying. The other thing, I mentioned communication devices. The idea is to communicate without distraction. When you have generations like my kids, one’s a teen and one just got out of his teens and is now in her 20’s. What are they carrying around with them all the time? They got the cell phones, as many of us do. Those are distractions. In a family meeting, as much as you don’t want to have to tell a younger generation, can you put the phone down or can you leave it over here? Put it on vibrate doesn’t help because it vibrates and it’s a distraction when they get text messages from their friends and their colleagues and so forth. So one of the tools we use, of course, is number one to test for understanding. Make sure people hear what’s being said. Make sure they hear it clearly and understand the meaning of that. Try to eliminate the distractions inside of the family meeting, that would be cell phones or any other distractions which might cause them not to hear what’s being said. Then the leader, the family member who’s going to be leading this meeting should know how to engage people. The engagement process comes from good communication skills to begin with, so that would be having some key points to discuss, being clear and concise, being accurate in what they’re saying. Deliver things in a courteous way. I like to tell people in an organizational setting, and this applies to families too, is try to focus your points that you want to get across into three key messages. There’s something about our brains that are more receptive when things are told to us in threes. We see it in advertising – just do it. We see it in political slogans – yes we can. Three key points. I’m not talking about writing slogans or advertising, I’m talking about just, hey today, we’re here as a family and there’s a couple of things I want to get across in this meeting. We’re going to talk about this, we’re going to talk about this and we’re going to talk about this today, and I want everybody to understand the reason why we’re having this particular meeting. That kind of resonates with people a little bit. If you can drive things home in message and reinforce that with important content that is clear and concise.
TONY: That’s a great input. While you were talking about the texting thing, I’ve got to admit, my kids are driving me nuts these days sitting right there texting each other back and forth. It reminds me of a commercial that’s running right now where a husband and wife are sitting at a table out to eat, and he’s talking to her and he literally finally texted her, like hey, let’s put the phone down. It is a challenge with getting attention span today. The rule should start with, check your phone at the door, you know. Show up to be no place else is a phrase I love to hear. Jeff, so far we’ve been really kind of focusing on communication amongst the family and wealth transfer, of course, prior to a difficult event. Let’s say when mom and dad are gone, that’s truly when wealth transfers. So far, we’ve kind of covered the importance of communication on the design side of that distribution, whether it’s just private wealth or family businesses. We’re going to have to take a short break, but when we come back, can we maybe address the other side. Now that, let’s say, I always call it when the glue is gone – mom and dad are gone, now there’s the family that has to maybe following the planning that was put in place, and generally this coordinates with an advisory team. A lot of times there are attorneys at this phase, financial people, accountants. That it’s also important to make sure that you properly communicate amongst those team members to keep everybody in the loop as that wealth is transferring or business is in a succession phase. I’d love to address those issues when we come back – so please stay tuned.
TONY: Welcome back as we continue really a great conversation today with Jeff Lanza who is a retired FBI Special Agent and has written a book called PISTOLS TO PRESS: LESSONS ON COMMUNICATION FROM AN FBI AGENT, and spokesman. Jeff, before we get into that thing I teed up before the break here, maybe just comment on your book and also your website and some of the resources that are available to our listeners today to learn more about communication from your obviously vast knowledge.
JEFF: Sure. Well I retired from the FBI after 20 years as an investigating agent and also a spokesman. I wrote a book that has to do with communication in general. Some of it has to do with media relations. Not all people deal with the media, of course, but there’s a lot a lessons in there about just how to communicate in general, talking to small groups of people, talking interpersonally with one person and if you were ever in a position where you had to deal with the press, there’s lots of lessons on that in that book, as well. On my website, you can purchase the book, but there are lots of free resources on my website, too. The handouts that relate to the presentations that I do on communication on ethics, which is another really important topic; on identity theft, and protecting information. Lots of free resources out there that people can download just by going to my website. That’s at thelanzagroup.com.
TONY: Let’s kind of transition then to my example of, let’s say mom and dad have done all the planning, there’s been communication and family meetings prior to that, but now unfortunately the reality of when mom and dad are gone and wealth transfers to the next generation, whether it’s just again private wealth or a family business. Having that trust and confidence in that design team that hopefully was part of the process all the way along – the attorneys, the accountants, the financial people – this has got to be a very stressful point clearly for families. We’ve lived it as planners. Talk about how important communication is among the advisory team and the family, keeping everybody in the loop as far as wealth transfers.
JEFF: Right. Well, again this comes right back into the realm of communication and opening those channels to communication before you get to the point where you have to sit down and discuss after someone’s passed away. For example, my parents are both still alive. They’re in their early 80’s. I have met with my father’s financial advisor who he’s had for years, to open up those lines of communication. These types of things, it’s always best to meet the important players and connect from a communicative standpoint before something happens, and you do that for a couple of reasons. One, you know them, it’s easier then to communicate when it comes to the point where you have to because of something that’s happened, but also it builds that trust and the communication that takes place. During those earlier meetings establish that trust and credibility and if you find that there’s someone you can’t trust, that they don’t have credibility, then maybe you look at a different person to fulfill that needs; but it comes beforehand. I think it’s so important to do that in the early stages and always be communicating with those people on a regular basis as time goes by.
TONY: Excellent point. Because without trust not a lot is going to get done and, of course, I’ve been blessed to be working with some families for 20 plus years and it’s wonderful to have that relationship and communication in advance of an unfortunate event. That clearly should continue after any event, especially if someone passes away, but now there’s emotions on the table, and what we typically find is one of the children who is ultimately potentially the beneficiary or one of the beneficiaries now has to wear the hat of let’s say personal representative if you have a will to distribute your estate, or a trustee if you have a trust to distribute your estate to your beneficiaries. That can add a component of stress to the family environment, simply because there is this perception that one is in control, and the other ones are just kind of waiting on the sideline for their distribution. That can really add another dynamic that is a challenge. Parents tell us consistently, we just want everyone to be happy and peaceful, and we don’t money to change people. Help us with that scenario.
JEFF: Exactly. What my parents would say, and I think a lot of parents say that exact statement, we just want people to be happy and everybody be treated fairly. Again, that comes right back to preplanning and getting together with the family before there’s a requirement to do that, because someone has passed away, opening up the lines of communication. The important thing that that does is it sets the expectations and it minimizes the chances that there will be some disagreements. If there are some, those can be worked out beforehand when the people who have the wealth are still around to help with that. Most of my early learning in communication came from dealing with the press as an FBI spokesman. One of the biggest factors I think in being a successful spokesman is setting the expectations for what the media is going to receive, what they’re not going to receive. I think you can apply that to family situations in terms of setting expectations early on; and doing that through good communication while the parents and generations are still around to talk about it, I think will lead to less disagreements later on.
JIM: As planners, a lot of times we’re leading the charge to create those communication things, but not everybody works the way that we do leading that charge, but as a family member just because one of your advisors isn’t leading the charge, you might need to take the bull by the horns. One thing we’re always asking our clients, when is the last time your accountant talked to your attorney or your attorney talked to your financial advisor, your financial advisor talked to your accountant? I don’t know how anybody can get the best advice if those different people are not communicating, because there’s overlap in the advice that they’re doing and there’s affect by what one planner might do and what another planner is doing. What advice would you have for getting that team communicating with the family and not just working with just one or two, but getting them together and making sure everybody’s on the same page?
JEFF: Well, first of all it comes down to what you eluded to; it’s just the team, the word team. Identifying the team. Who are the players that are going to be involved in this process of wealth transfer early on from all of the different family members’ perspectives? Identifying the key people that need to be included in those communications and start very early in making sure that they are. Once they’re identified and then you start drawing them in, I don’t mean you have to have, you know, formal meetings, getting people maybe from different parts of the country to get together personally, no, but just virtual meetings or email communication or phone conversations, conference, web conferences, could be an easy way to get all those people talking. Again, it’s before. There’s a requirement that they talk when someone’s passed away. Again, it helps to establish that trust and credibility of that team.
JIM: I can’t imagine throughout your career, Jeff, the type of scenarios that you were faced with as far as managing communication, especially I guess we can argue in one sense the way we present this program. It’s kind of in a media approach, but boy I have no love and affection for the media myself and how they communicate to Americans today, and I’ll leave it there, but it’s a challenge. Bless you for retiring and not going nuts probably trying to do that job that you did, especially I’m sure in your position at the FBI to some of the cases had to be so emotional. As I read through your book, it’s just amazing some of the cases you were involved in and how the media really treated, not only you but the cases and the family itself. It’s a shocker. Maybe what we could do, because we’re going to wrap, is just again mention the book and how folks can get that and, again, the resources on your website.
JEFF: Sure. The book is called PISTOLS TO PRESS. It’s available only on my website and my website is www.thelanzagroup.com. In addition to the book I have lots of free resources on important topics to your audience. Communication would be the one we’re talking about today, of course, but other topics such as identify theft prevention, social networking fraud security, cyber security, how to keep seniors safe online.
Tons of handouts out there, all downloadable for free, that give lots of good information to people to help them in their everyday lives.
TONY: And that’s partly why we had you here today, is really to share with the listeners that there are these resources out there and what better expert to have it come from than, again, the career path that you were on. I appreciate you kind of adapting your communication presentation to wealth transfer in the family because the general rules certainly apply, the takeaways are make sure that you have those family meetings, that you communicate, check the phone at the door – I got that one – and we’d love to have you back on some of those other topics. We greatly appreciate your passion project here and sharing with our listeners today from your vast knowledge. Thanks for joining us today.
JEFF: You’re very welcome. Thanks for having me.
JIM: Thanks for joining us this week and tune in again next week as we explore another phase of the real wealth process. Remember, if anything you heard in today’s show you’d like to get more information about, contact your Prism Insurance Agency Advisor. Also, if you feel that any of this information will be helpful to a friend or family member, just click the “Forward to a Friend” button.