June 2001 // Volume 39 // Number 3 // Tools of the Trade // 3TOT3

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Begin With a Family Tree When Working with Family Finances

How should you start when meeting with a family on financial matters? Here I show an example family tree and give 16 benefits of beginning family financial planning meetings by sketching a family tree. A family tree is an easy way to quickly and efficiently collect and organize family information. One never knows what family member(s) will be key to a financial decision, so it is useful to get everyone identified at the beginning. Some other benefits include getting your meeting off to a good start, collecting needed information, and identifying frequently overlooked family members and relationships.

Jim Polson
Associate Professor & District Specialist, Farm Management
Ohio State University Extension
Wooster, Ohio
Internet Address: polson.1@osu.edu


Working with clientele is part of everyday life for most Extension agents and specialists. There are many advantages to sketching a "Family Tree" to begin a family meeting on in-depth family matters. It is especially useful and important when helping a family with financial management and planning, including:

  • Budgeting,
  • Planning major purchases or sales,
  • Guiding business decisions, and
  • Estate and business succession planning.

The necessity and wisdom of this approach was brought to my attention very abruptly one afternoon many years ago. I had spent an hour and a half with a 73-year-old widow, with property worth $750,000 or so, discussing her estate planning alternatives. We were finishing our discussions and starting to rise from our chairs when she stated matter-of-factly, "My 93-year-old father is still alive and plans to leave me a 300-acre farm. Will that make any difference?" I was flabbergasted! Absolutely astonished! How could I have possibly overlooked this obviously important information? Of course her father and his farm made a difference!

I was young, and she was 73, which I naively thought was old, so I never thought to ask about her parents. I vowed to never again make the mistake of overlooking a family member! But I needed a way to quickly collect and organize family information for up to 20 to 25 family members in three or four generations.

Several years later I "discovered" a simple methodology for organizing family information at a seminar. The speaker illustrated her talk by drawing a simple family tree of the people involved in the relationships she was discussing. She put the men's names in rectangles and women's names in ovals and connected them logically to draw a "family tree." Each generation was placed together below the previous generation (see below). If a person was deceased or divorced, she used an "X" to signify the break. The widow's family tree included 18 members and looked something like this:

Family Tree chart

It was simple. In a few minutes she graphically illustrated family relationships for a large family. She also wrote ages and little notes beside some names to provide further insight into the individuals and how they fit into the family. I immediately realized the potential for using this simple tool when meeting with families.

As an economist and CPA, I have a natural tendency to focus on financial information. It is easy to get distracted by financial information and make premature recommendations based on the numbers while overlooking the crucial issue of FAMILY. I now use a simple, effective, four-step interview strategy for working with farm families who want advice on family financial issues. I collect information about the three "Fs": family, farm, and finances--in that order. The fourth item, "Getting a clear statement and understanding of what the family wants from me," may occur at anytime.

Whether you are meeting with one family member or are involved in a family meeting with a dozen people from three or four generations, it almost always pays to "Begin With a Family Tree." Family members are frequently curious, but no one has ever objected or questioned the relevance of the family tree.

16 Benefits of Beginning With a Family Tree

  1. It is usually a successful beginning for the meeting. This is especially important when there may be family tension or a high probability for disagreement. It quickly puts family members at ease. The focus shifts from their problems or concerns to my getting their family tree drawn accurately. They come expecting to discuss serious financial matters and find themselves telling me about their family, which is usually non-threatening.
  2. It breaks the ice and helps get everyone in attendance involved in the conversation. Extroverted husbands who normally speak for the family quickly defer to their wives to provide information about their children and grandchildren. This allows me to naturally bring wives and children into the conversation and makes it easier and more natural for them to participate later.
  3. The family tree isn't complete until everyone including the "black sheep" in the family are identified and recorded. Frequently family members volunteer helpful information about "black sheep" and other family members.
  4. "Special needs" family members with physical and mental handicaps are identified, along with their special circumstances and needs.
  5. It frequently uncovers divorces, remarriages, and deaths that may have a bearing on decision-making.
  6. It tells me at a glance who is in the bloodline and who is an in-law. This is very important in most family's decision-making processes and in their decisions.
  7. It gives me a very handy reference when family members start talking about "Susie" or "Sam." I can look at their family tree and quickly see where they fit in the family and follow the discussion without interrupting the family's conversation. If they talk about someone not on the chart, I know to ask how they fit in.
  8. It helps me quickly remember the details of their situation if family members should contact me later.
  9. Drawing a family tree makes productive use of our time while we wait for the almost inevitable "tardy" family member to get to our meeting.
  10. When family member arrive late, they are usually quickly "put at ease" when I briefly review the family tree with them. They can see we have been productively discussing information they are already familiar with, and they have no reason to think they were left out or that we have been talking about them in their absence.
  11. Asking for family information is professionally appropriate and necessary. It is difficult to provide appropriate family counsel if you don't know who is in the family, as I found out with the 73 year-old widow.
  12. It is very quick, efficient, and accurate. The "family" will usually make sure you record family relationships accurately.
  13. When drawing a family tree takes more than a few minutes, it is usually because someone is sharing family information, history, and background they consider important but whose relevance to you as an advisor may or may not be apparent.
  14. It organizes in one simple-to-read chart names, ages, and family information that would be very difficult to remember, especially at a subsequent meeting.
  15. I can quickly look at the family tree and make sure we have adequately considered all family members in our discussion. For example, it might lead to the following type of question, "How are you providing for Larry and Sandy, who will not inherit the farm?
  16. It puts the focus on "family," where many family members feel it belongs.