Nothing wrong with being an heir – and getting your heritance in full only makes it better, says David Nicholson
Nothing wrong with being an heir – and getting your heritance in full only makes it better, says David Nicholson
Not long after Lord Hesketh sold his Northamptonshire stately home, Easton Neston, to a Russian fashion designer for £15 million (the asking price was £50 million), his 24 year old socialite daughter, Flora, was cornered by a journalist at a party. Asked what she thought of the new owner moving into the Hawksmoor mansion, which been her family’s home for several hundred years, she replied: ‘We’re just glad the house is Grade 1 listed so they can’t do anything really vulgar to it.’
Passing on large fortunes or estates to the next generation can be a fraught business. Death duties may be so enormous that a house that’s been in your family for generations has to be sold. There may be several heirs with very different ideas on how it should be used. Or you dad – in Hesketh’s case – might just have burnt through the family loot by investing in mad-cap Formula One racing teams and failing for years to listen to the family accountant.
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Much of the problem is that within wealthy families across both America and Europe, the subject of inheritance (i.e. who gets what when daddy dies) is often too taboo. ‘Many people in this position are not good communicators,’ says Will Browne-Swinburne, who runs the Successors’ Group at the Historic Houses Association (HHA).
The lobby group for heirs-to-be of Britain’s finest privately owned historic houses gets together several times a year to talk about issues of estate planning, succession, and death duties. Members range from teenagers to some old boys in their 60s. ‘They’re quite shy and they feel if they mention the problem, they’re going to sound like a spoilt toff,’ adds Browne-Swinburne. ‘People are pretty clammed up about it.’
What is interesting is how such beneficiaries (many of whom are living fairly humbly in an estate cottage or old nursery wind of their family pile) are now being specifically targeted by private banks as future clients. Indeed, the perks of being an heir today – whether to a chain of northern supermarkets, a Texas oil fortune, or a ducal estate – have never been so good.
In the old days, for example, the HHA Successors Group Christmas party resembled a modest book launch party: a few cases of average plonk and some nibbles. That has all changed, however, now that the group are sponsored by UBS.
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Now it’s a glitzy cocktail party held at Tate Britain, which – as the glass of the (often unmarried) heirs to Britain’s statelys are refuelled every few minutes – is nothing less than an ambitious mother’s social wet dream.
Indeed, this is the direction many banks are now heading as competition increases to form ‘relationships’ with the sons and daughter of high net worth families, from an earlier and earlier age. Coutts and Barclays Private Bank are experts. Clients will often ask their bankers to talk with their children – sometimes age 13 – about the financial responsibility they will be taking on.
An example of just how far Coutts has moved away from their old fuddy-duddy image is the June charity pop concert they hosted at their famous Strand headquarters featuring teenage heart throbs Natasha and Daniel Bedingfield.
Campbell Gordon at UBS has found that a major difficulty for heirs today is being kept in the dark about their family’s finances. ‘We try to get them interested and break down the barriers. We run several day courses to give people background to financial markets.’
It is for exactly this reason that American Express Private Bank has launched an exclusive summer tutorial seminar for client’s children aged between 18 and 26 called ‘Tools to Build Your Financial Future’. Around 80 young, rich kids attend this wealth orientation seminar (‘networking dinner’ included) over a long weekend in August at the Lanesborough Hotel in London.
‘Visitors are greeted as honoured guests as if in a private home,’ reads the course brochure. ‘Students are expected to have at least a basic interest in finance and investment.’ So popular has this programme become that parents have now started trying to enrol themselves. ‘It’s about educating people from an early age,’ says Amanda Wallis, Executive Director of American Express Bank in London.
Over in the US, returning to an Ivy League college in the fall saying you were at a summer ‘wealth cam’ is increasingly common. The Wharton Business School runs summer ‘camps’ where rich families gather in groups of up to 40 to discuss their financial problems and strategies, including succession. ‘We often have whole families turning up,’ says Katie Wiesel at Wharton.
The idea of 40 ultra-rich people sitting in a room discussing their succession strategies is quite mind-boggling to the British. But Wiesel insists that these sessions do not turn into mass counselling events, nor furious feuds. ‘The people come to these events are self-selecting, they’re generally ready to share.’
Whether Britain’s young heirs are ready for ‘sharing’ on this scale remains to be seen. But if such seminars had been around when Lord Hesketh was a young man in a hurry, perhaps he would still be enjoying the view from Easton Neston.
