Wealth transfer's costliest mistake is waiting

Warren Buffett's July announcement that he will distribute the remainder of his Berkshire Hathaway shares over eight years rather than through an estate has raised a question most wealthy families postpone: when does the transfer actually begin? Sarah Salomon, head of family advisory and philanthropy services at UBS in the US, told InvestmentNews the answer is almost always sooner than families think, and the cost of waiting is rarely just financial. "What we think other families can take from this is that waiting to communicate and act comes with a cost," Salomon said. "If the first time the next generation deals with the family's wealth, intentions or decision making is after the wealth creator is gone, the family has missed out on opportunities for learning."

Buffett has been making incremental transfers to family-run foundations for two decades; the eight-year pledge continues a philosophy he has followed for two decades. The lesson for families is less the billionaire's giving schedule than the head start: he began the transfer long before the estate was the only vehicle left.

The industry has built an entire service stack around the technical side of that question: estate attorneys draft the documents, tax advisors optimize the trusts, and custodians stand ready for the assets. Far less of the institutional machinery is built for the part Salomon says matters more: the years of practice a family needs before the founder is gone. The cost of waiting seldom appears on the estate tax schedule; it arrives in the family's first real decision together, often at the worst possible time.

Most wealth transfer conversations are framed around estate planning and tax efficiency, a frame Salomon argues is necessary but incomplete. Legal documents can transfer assets and authority; they cannot transfer judgment, communication skills, shared purpose, or the ability to navigate disagreement. Her formulation, which could sit at the top of any family-meeting agenda, is that wealth transfer is the event, wealth transition is the process, and readiness for responsibility is the outcome.

That is where an advisory firm quietly loses the next generation. Estate planning answers what will be transferred, to whom, through which structures, and on what terms; it does not answer what the wealth is for, what will be expected of the people who receive it, or how siblings and cousins will make decisions together. Those human questions determine whether assets stay in the family or end up with a new advisor once the estate settles. The RIA is the natural host for that conversation, because unlike the estate attorney, whose engagement ends when the document is signed, the advisor remains in the room after the signing. An advisor who uses that position to convene the next generation builds a relationship that survives the transfer; one who limits the conversation to account registrations and beneficiary forms leaves the human questions to whoever shows up after the founder dies.

Philanthropy, in Salomon's view, is the most practical bridge between the technical and human dimensions. Giving together forces a family to articulate values, explore options, make decisions, deploy capital, and learn from outcomes — a rehearsal, in effect, for larger responsibilities. For an RIA, philanthropy teaches governance as much as tax strategy, and it gives the next generation a low-stakes place to practice judgment before the decisions are permanent.

The conversation advisors most often avoid, Salomon said, is asking the wealth creator to define what "ready" actually means. The evasion tends to produce silence, and silence has its own family dynamics: parents may believe they are protecting their children by not sharing information yet, while adult children may interpret that silence as a lack of trust. By the time the documents come out, the family is already negotiating from those positions. The cost is rarely visible on a balance sheet; it shows up in the first family meeting after the death, when the siblings who never practiced a decision together are suddenly asked to make the biggest one of their lives. By then, the advisor who accumulated the technical documents but never the trust of the rising generation is competing with every other professional in the room.

The wealth industry's own numbers show how rarely this process starts early. As PWD's Make-A-Will Month coverage noted, only about a quarter of American adults have a will, and many existing plans are outdated. The gap is less about documents than about timing. The same failure appears in the ownership-transition world, where exit plans break when value, liquidity, and succession run on separate clocks. In family wealth, the equivalent break comes when the plan is complete but the people are not ready for it. At one end, adults have not even named an executor; at the other, business owners have a valuation and a deal timeline but no process for the people. The family wealth version sits in between: the trust is funded, but the heirs have never rehearsed a decision.

The firms that hold assets across the coming transition will be the ones that turned estate planning into an intergenerational exercise — convening siblings, staging the philanthropic rehearsal, and asking the founder what "ready" means while there is still time to answer. A trust document can move assets on a schedule, but it cannot make the next generation capable of keeping them. The advisor who stages the rehearsal keeps the relationship, while the one who only files the documents watches the money find another home. The remedy starts with a single meeting.