September/October 2013

In this issue

  • Wealth planning for families with illiquid assets

    Wealthy business owners with mostly illiquid assets have many wealth planning opportunities that are unavailable to other families. They also face significant challenges for the management and preservation of their wealth, particularly if their assets become liabilities.

    Business owners often underestimate their family’s illiquidity risks. To understand some of the risks, it can be instructive for owners of private businesses to consider the following questions:

    Family firms must learn to manage concurrency

    A fourth-generation family business grappled with the definition of family ownership for many years. They struggled with whether to limit ownership to blood relatives and what to do with former spouses after a divorce. They wanted to appropriately restrict ownership to protect their enterprise, yet they also wanted to promote a spirit of inclusiveness.

    Building a burger empire together

    When Jerry Murrell’s two oldest boys, Jim and Matt, spurned college, Jerry brokered a deal with the two teens: The family would use the cash collected for the boys’ college education to open a hamburger shop that the boys would then run.

    That agreement, made 27 years ago, spawned a company —Five Guys Burgers and Fries—that now sits among the restaurant industry’s largest family-owned enterprises.

    A fast-growing father-son partnership

    As a young man in his 20s, Keith Tillage was an entrepreneur in search of a business. Not content with a rising career in corporate America, he wanted to build his own company. He just didn’t know what kind of company.

    Generation 6's accidental jeweler

    Kris Cornwell planned to be a teacher, not a jeweler. Cornwell Jewelers, her family’s Athens, Ohio, jewelry store—founded in 1832—was always in the background of her life, but it wasn’t until her parents begged her to take over that she became the sixth generation to run Cornwell Jewelers.

    “Just try it for six months,” suggested her mother, Connie. That was in 1994.

  • Life insurance is an option for dynasty trusts

    Until the 1980s, American trusts could last only about 100 years. Then, many states repealed their laws that limited the duration of trusts. This new style of trust, often called a “dynasty trust” to reflect its unlimited duration, has largely taken over trust planning.

  • Continuity is ensured at Gen 4 firm

    Charles E. Rue began Rue Insurance in 1917, selling insurance out of the back room of his New Jersey feed mill. When customers came to see him, “I’m sure he ultimately then started talking to them about insuring their farm buildings with him,” says the founder’s grandson, William (Bill) Rue Sr., 65, now the firm’s chairman.

    Today Rue Insurance, headquartered in Hamilton, N.J., takes “a risk management advisory” approach, says Bill Jr., 37, the fourth-generation president.

  • September/October 2013 Toolbox

    A Wealth of Possibilities: Navigating Family, Money and Legacy
    By Ellen Miley Perry
    Egremont Press, Washington, D.C., 2012 • 149 pp. • $20

    In A Wealth of Possibilities, Ellen Miley Perry addresses the relational challenges confronting highly successful wealth creators and their children. Perry, who co-founded a multi-family office that later became GenSpring and has been an adviser to wealthy families for 20 years, emphasizes parenting, which she contends is an essential foundation for the family’s future.

  • At the Helm: Frank Blethen

    Generation of family ownership: Fourth.

    Years with the company: 52.

    Size of company: Regarding print circulation, we’re the second largest newspaper on the West Coast after the Los Angeles Times. We’re also among the largest family-owned papers and a nine-time winner of the Pulitzer Prize.

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