After Crisis Comes Growth: Family Resiliency and Rebuilding Trust
This edition of the Family Office Association Newsletter features insights on family resiliency and rebuilding trust by Dennis T. Jaffe, Ph.D, Professor of Psychology and Organiza onal Systems, Saybrook University
There is no Wealth but Life. Life, including all its powers of love, of joy, and of admiration. That country is the richest which nourishes the greatest number of noble and happy human beings; that man is richest who, having perfected the functions of his own life to the utmost, has also the widest helpful influence, both personal, and by means of his possessions, over the lives of others.
–From John Ruskin, Unto This Last.
The huge financial upheaval of the year 2008 deeply affected every family’s experience of wealth. Families that spent with the expectation that their wealth would grow, find their wealth has significantly declined. For family members who are accustomed to receiving passive income, the upheaval has a deeply personal aspect, as they must adjust to new conditions that may be permanent. A family may have significant wealth but nonetheless need to move from one wonderful vacation house to a smaller one, resign membership in a club or limit philanthropic commitments, leading to a feeling of loss and even public shame. While the family remains “wealthy” before and after the upheaval, relatively, they feel a loss, with complicated feelings of anxiety, distrust, and even anger and resentment. The safety and stability of their wealth, and their trust in the financial stewards who oversee it, have declined. As a result, many families have begun to review their expectations and assump ons about spending and lifestyle.
One casualty of the crisis has been the loss of trust in many sectors of society. Families have lost trust with employers to provide for retirement, or even for continued employment, in government to make sure that the market and nancial system functions, and most personally, in financial advisors and financial institutions who made promises that they did not deliver. And, most devastatingly, as a society, we have lost trust in the earth and the environment for magically providing us with food, water and a natural bounty that will last forever. What lessons are families taking from this loss of trust, and how are families best able to proceed? Trust is easy to lose and hard to rebuild. When it is lost, people tend to react precipitously and do things that upon reflection, are premature.
View the Newsletter in full: Newsletter: After Crisis Comes Growth: Family Resiliency and Rebuilding Trust