Enjoy and gain some insights on inter-generational challenges, including the need for knowledge transfer and leadership transfer between and across the generations.
Let me know what you think. I welcome comments, questions and all feedback.
Phyllis Weiss Haserot www.pdcounsel.com
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Whatever generation you belong to, whatever stage of your business as a trusted advisor, you are more likely to encounter inter-generational challenges than ever in the past. That’s because external forces and formative influences have resulted in greater differences in how the generations view money, lifestyle, investing, philanthropy and relationships.
Money may not be the root of all evil, but it often leads to the primal “fight or flight” response.
Talks about money are often the hardest discussions among work colleagues, family members, friends and even in instances of our own self-talk. It’s an emotional thing tied up with perceptions of our self-worth or somebody else’s. For some people money is more important as a scorecard than the actual value of what they can do with the money. In families it’s tied to how much one is loved compared with others
So it’s easy to see why money talks are avoided, even before taking such huge steps as marriage, living together and having children. Yet it’s been documented that relationships turn out happier when money conversations do take place before major decisions.
As I work with financial services professionals, I witness the tensions that can occur over money. Advisors often find it difficult to get their clients to talk with family members or business associates about money in order to do estate planning and decide how they would like to donate money philanthropically. And advisor teams may have their own money conflicts when they neglect to discuss in advance their attitudes, expectations, transitioning and exit strategies.
So, yes, money discussions can be volatile, but it’s worse to avoid them. Instead:
* Establish a shared language about money.
* Identify and avoid “trigger words.”
* Understand what key words connote for each party.
* Identify and be aware of your own “trigger words.”
This last point may be the most important for anyone trying to facilitate the discussion, whether among clients or family.
Phyllia Weiss Haserot www.pdcounsel.com
My guest blogger for this post is Brannon Poe, CPA of Poe Group Advisors in Charleston, SC, who advises accounting practices on practice management and selling their practices and author of Accountant’s Flight Plan.
There are two dilemmas that rattle the human skull: How do you hang on to
someone who won't stay? And how do you get rid of someone who won't go?
Danny DeVito, in The War of the Roses
When it comes to practice sales, timing is everything. It’s rare for practice partners to have the same exit timetable. Tensions mount when one partner wants out and the remaining partner either doesn’t want to buy the business or sell to a third party. If partners are the same age, the odds for a smooth dissolution are improved, but even a couple of years’ difference can strain a sale.
In a small practice, the process of selling or retiring is complicated for both the senior and junior partner in question. Motivations are completely opposed. The senior partner is ready to move on, while the junior member is often very resistant—understandably apprehensive about the changes this will mean for the business’s operation and his or her livelihood. Change is rarely welcome, and taking on a new outside partner can be a frightening prospect, as is the possibility of running the practice without the senior partner. Finding the right replacement partner is far easier said than done—just ask any departing partner who has tried to please an objection-filled remaining partner! Sometimes the junior partner is empowered by this naysayer role, and any perceived previous injustices seem to rise to the surface as negotiations move forward.
Making someone a partner is a significant step, one that shouldn’t be taken lightly. If you feel that partnership is the right path for your practice, great care should be given to selecting an attorney who can help structure your partnership agreement. This contract should clearly address exit strategies by any one or a group of partners. Excellent legal advice at this juncture is one of the best investments you’ll ever make.
Spend some time and money on your partnership agreement and make sure the lawyer you use has significant experience in this area. You’ll be glad you did.
Brannon Poe, CPA
The above is an excerpt from Accountant’s Flight Plan, Best Practices for Today’s Firms.
Marc Freedman, Founder and CEO, Civic Ventures / Encore Careers, announced that Encore Fellowships have been established as a retirement benefit by the first company to embrace the idea in a big way, Intel.
Encore Fellowships – paid, part-time, yearlong assignments at local nonprofits – provide a new source of experienced talent to organizations solving social problems, while offering those who have finished midlife careers the chance to transition to encore careers in the nonprofit sector. Intel has become the first company to offer Encore Fellowships to all of its retiring employees in the United States.
Intel retirees who become Encore Fellows will get a $25,000 stipend and six months of health insurance coverage, both paid by Intel. “Retirement benefits are no longer just about retiring,” said Freedman. “Instead retirement benefits can help cover the costs of transitioning to a new, encore stage of work for the greater good.”
Forbes columnist Kerry Hannon wrote, “The end of corporate retirement benefits is an old story. The rise of retirement benefits, well that’s worth some hoopla.”
Do you think we will see this idea blossom into a real trend? Should people be seriously thinking about this when they hit 50 or 55?
Do you have a story to tell to www.encore.org?
Phyllis Weiss Haserot www.pdcounsel.com
From Alan Weiss’ Monday Morning Memo 6/27/11
Alan Weiss is no relation of mine, but is definitely in tune with the way I feel about the retirement concept. Here is his Monday Morning Memo 6/27/11. http://www.contrarianconsulting.com
This week's focus point: "Retirement" has no real meaning any more. Most productive people, young and old, continually seek out new ways to express their talents and rejoice in life. To foresee an arbitrary age -- when many are at the height of their powers -- as a time to cease being creative and active is merely a form of conscious decline. Producing value and providing happiness are endeavors that should never be "completed."
© Alan Weiss 2011. All rights reserved
Reprinted with permission.
Phyllis Weiss Haserot www.pdcounsel.com
Marc Freedman, founder of Civic Ventures’ most recent book, “The Big Shift: Navigating the New Stage Beyond Midlife,” deals with the newly defined phase of life between midlife and old age. He calls it the encore phase, rejecting “young old” and “working retired” labels as unsatisfactory and inaccurate.
My side note: Interestingly, another phase of life has been identified in relatively recent years as well between adolescence and adulthood, but it is not referred to in the book. It is known either as emerging adulthood or enduring adolescence. I mention it because together the two phases illustrate how the lifecycle is stretching out not only in years, but also diversifying, presenting complexities, challenges and opportunities we all need to understand. The big shift is even shiftier than Marc Freedman contemplates.
But back to his focus on the post-midlife shift. Freedman does an excellent job of describing the oxymoronic nature of this stage in great detail: “A World Out of Whack,” as one of the chapters is titled…”individuals are thrown into an identity chasm”… “myth of Boomer reinvention.” Freedman sees the “reinvention fantasy” as part of the problem. He sees the “obsolescence of much of what’s accepted as hard reality by many economists and demographers of today.”
Currently, social entrepreneur Freedman says,” the transition from midlife to this new encore stage is a do-it-yourself project with little guidance, few role models, and scarce resources.” Imagine the windfall of talent that could result, he says, helping carry us toward a new generation of solutions for growing problems in areas like education, the environment and health care.
Freedman advocates for a new map of life and how to navigate it. Boomers will not deal with their 60s and 70s as generations before, both given their fitness and their mindsets. He is optimistic that this encore stage can be characterized by “purpose, contribution, and commitment, particularly to the well being of future generations.” (I am sure the skeptical Gen Xers and Yers will be glad to see that happen.)
Freedman lays out 10 possibilities for translating opportunity to large-scale fruition. The missing piece is where the funding and institutional fortitude to make it a reality will come from. He is hoping his imaginative and inspirational ideas will attract the attention and resources.
Marc Freedman is not only an important and articulate voice, he is a doer. And with a fortunate alignment of the stars and a great deal of effort, it might happen.
Phyllis Weiss Haserot www.pdcounsel.com
By not retiring on the schedule expected, what affect are Boomers having on the younger generations’ careers? I wrote about this issue at the request of Aging Today, a magazine (March/April 2011) of the American Society on Aging. Here’s my briefer answer.
In a thriving economy, this question would not even be asked. We’d be challenged by what was expected before the severe recession in 2008 – a labor and talent shortage. Forecasts said that the retiring Boomers couldn’t be replaced with the much smaller Gen X cohort – even with the ambitious Gen Y/Millennials vying for quick promotions. Eventually the supply and demand balance will change to reflect those demographic forecasts.
There shouldn’t be an expectation of a mandatory retirement age for people who are productive, energetic, knowledgeable, connected and willing to be team players. While that’s certainly not all the Boomers, it describes a lot of them. If all the Boomers left with their knowledge, skills, judgment and contacts, the workplace and organizations in general would suffer significantly.
On the other hand, shifts are in order, and younger people need opportunities to grow, prosper and lead. That means that many boomers need to accept a shift in their roles, a transfer of leadership sooner or later and frequently, situations in which they are reporting to and supporting younger managers. For my thoughts on the last, read http://www.secondact.com/2011/04/how-to-survive-a-kid-boss/
Phyllis Weiss Haserot www.pdcounsel.com
Changes in retirement polices in both the public and private sectors are hot issues. Have you thought about how people from various countries and cultures think of retirement?
The HSBC group conducted a study of over 11,000 people around the world to find out how individuals in various cultures perceive what retirement means and how they expect or want to spend it. The study and analysis is part of HSBC’s “Future of Retirement” series and was reported on in Employee Benefits News (Nov. 2010). The differences and similarities are quite interesting. Here is a summary:
The differences probably say a lot about different cultures and political and economic systems. There is a lot to sort out in order to get the nations cooperating to really recover from the world-wide financial crisis we have been experiencing.
Phyllis Weiss Haserot www.pdcounsel.com
The 3rd Quarter CFO Outlook Survey, conducted by Financial Executives International and Baruch College’s Zicklin School of Business, showed optimism on hiring and a desire to delay retirement out of both desire and need. The survey comprised interviews of 249 corporate CFOs electronically from October 6-14 from both public and private companies and from a broad range of industries, revenues and geographic areas, including some off-shore companies.
The survey also revealed the following priorities coming out of the recession and following the staff reductions experienced by many:
The survey found that many CFOs plan to work beyond the traditional retirement age. Further, they are, in fact, in favor of increasing the retirement age. Forty-one percent anticipate that they will work past age 65 out of desire while 31 percent will do so out of need. Three percent of them already are working beyond 65. As for an overall increase to the traditional U.S. retirement age, 59 percent favor it, with three years being the average desired increase among those respondents who specified an age.
Succession planning continues to lag despite lip service to its importance. Only 30 percent of responding CFOs currently have a plan in place. While 40 percent of the remaining CFOs believe a plan should be created, another 31 percent do not see the need for one at all.
Full survey results and historical data comparisons are available at www.financialexecutives.org. The study also is available online at the Financial Executives Research Foundation bookstore and on the Baruch College home page at www.baruch.cuny.edu.
From my conversations with future American Bar Association presidents and incoming section chairs at the ABA Annual Meeting, transitioning of practices and continuing careers of senior lawyers (now in midlife) is a big concern and high ranking agenda item. It’s a concern from the standpoint of retaining members and keeping them engaged. It also reflects empathy for their peers who are approaching the time they will be faced with the need to make significant choices. Many members may find themselves panicked and physically and mentally stressed because lack of forethought has led them to a career and personal precipice.
Several bar leaders expressed to me a great interest in presenting programs that will nudge and guide
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