LAUREN HUTTON AN ICON FOR ALL AGES: A CONVERSATION WITH MODEL AND ACTIVIST - Magazine - Brown ...
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Magazine
AN ICON FOR ALL AGES: A CONVERSATION WITH MODEL AND ACTIVIST
LAUREN HUTTON
Fall 2019
CONTENTS Magazine
1 L ET TER 12 P H I L ANT H ROP Y & W E ALT H PL ANNING CONTRIBUTORS
A Letter to Our Readers Resilient Estate Planning in the Face of
Kathryn George
Unexpected Life Events
2 F EATU RE
Adrienne Penta
An Icon for All Ages: A Conversation 18 B U S INE S S & INV E S T ING Joann Gilbert-Holmes
Kaitlin Barbour
with Model and Activist Lauren Hutton Growing into the Future Alison Hutchinson
Stacia Kroetz
8 F AMI LY 22 F I VE QUE S T IONS W IT H... Jules Pieri
Juggling Eldercare, Childcare and Work: Maura Cunningham Maura Cunningham
Fitting In the Unpredictable
24 S P OT LIG H T EXECUTIVE EDITOR
10 B Y THE NU MB ERS Inside BBH
Adrienne Penta
Women Breaking Down Barriers EDITOR
Kaitlin Barbour
DESIGN
BBH Creative Services
2 12
22
8
10 18 24
WOMEN IN RETAIL WOMEN IN EDUCATION
The retail industry holds the Number of women
highest percentage
B | Women &ofWealth
womenMagazine university presidents
1966 2016
CEOs 12%
| LETTER
A LETTER TO OUR READERS
In this issue of Women & Wealth Magazine, we focus on women who are breaking the mold and
making history. We had the pleasure of speaking with women who are pioneers and leaders in their
fields – these are women who have been “firsts” and are taking care to pave the way for the women
coming after them.
In our feature article, the legendary Lauren Hutton shares travails from her multifaceted career as
a model, an actress and an activist. As the first model to secure a contract, she has changed the
landscape of the modeling industry for the better, has been honored by leading high-end fashion
Kathryn George
designers and is an influencer for beauty at all ages. Hutton also talks about her motivation through Chairwoman
it all: to travel the world.
Liz O’Donnell, the founder of Working Daughter and the author of “Working Daughter: A Guide to
Caring for Your Aging Parents While Earning a Living,” has created a community for women who are
balancing caregiving, career and more. We recently sat down with her to discuss why eldercare and
the 44 million caregivers in the United States deserve a spotlight.
In this issue’s “By the Numbers” infographic, we chronicle the strides women have made in leadership
over the years and across multiple industries.
Adrienne Penta
Estate planning is about more than taxes. In “Resilient Estate Planning in the Face of Unexpected Executive Director
Life Events,” Wealth Planners Ali Hutchinson and Stacia Kroetz discuss the importance of flexibility
in planning. The future is unknowable, but centering your plan on your values and communicating
regularly with your fiduciary and your family will set your family on the path to success.
This issue also includes an excerpt from Jules Pieri’s recent book, “How We Make Stuff Now,” about
how entrepreneurs grow and scale their businesses. Pieri is the co-founder and CEO of The Grommet,
an online marketplace for innovative products. As an entrepreneur and investor herself, she shares
her insights into the world of entrepreneurship, being a founder and CEO and growing a business. The CW&W supports women
in the creation and manage-
Finally, in “Five Questions,” Maura Cunningham, founder and CEO of Rock The Street, Wall Street ment of wealth. We seek to
(RTSWS) – a nonprofit organization that enhances high school girls’ financial literacy – discusses the create a dynamic and inclusive
importance of increasing girls’ confidence in the M in STEM, engaging the next generation to pursue environment where women
a career in finance and her journey in building RTSWS. can engage in conversations
about wealth, family and
We hope you enjoy this fall edition filled with women who are pushing boundaries. If you would values.
like to be more involved with the CW&W, please do not hesitate to contact us at cw&w@bbh.com.
We are committed to helping
women business owners
Kathryn George Adrienne M. Penta and those with substantial
Chairwoman Executive Director wealth achieve their financial
goals throughout the cycle
of wealth creation, transition
and preservation. BBH Private
Banking serves female clients
and their families through
three integrated products
and services: Private Wealth
Management, Corporate
Advisory & Banking and
Private Equity.
Fall 2019 | 1
| FEATURE 2 | Women & Wealth Magazine
AN ICON FOR ALL AGES: A CONVERSATION WITH MODEL AND ACTIVIST
LAUREN
HUTTON
By Joann Gilbert-Holmes,
F
Senior Relationship Manager,
BBH Private Banking
ifty-five years into her career, Street. I knew I was swamp smart, but
Lauren Hutton – model, there I learned to be street smart.
actress and activist – shows
no signs of slowing down. One day in 1964, I was so tired, and
As part of a dynamic, highly someone asked me, “What do you
selective industry, Hutton has con- really want to do?” I kept thinking
sistently questioned and changed over that question, and the answer
the way the world sees modeling. was that I wanted to go to Africa;
She was the first model to secure it had been my dream since I was
a contract, has been honored by young. Another waitress said that
leading high-end fashion designers she wanted to do that too, so we
and is an influencer for beauty at all planned to meet in New York and
ages. Throughout it all, a key driver take a steamer that she knew about
of her passion and enthusiasm there together.
comes back to a childhood dream:
to travel the world. We recently sat My friend never showed up at the
down with Hutton to discuss her New York airport. I had $200 on me,
multifaceted career, the modeling two suitcases filled with everything
industry through the years and sev- I owned and was all alone. I took the
eral extraordinary experiences along bus to Port Authority and was terri-
the way. fied when I got off. I had nowhere to
go, but I remembered where Tiffany’s
You have been in the modeling indus- was, so I hailed a cab and went there.
try for 55 years. Tell us about how the It was a Sunday morning, and no one
journey started. was out on the street. I got out and
started crying because I didn’t know
During college and before getting what to do.
into modeling, I worked on Bourbon
Street at a jazz nightclub as a waitress, Another girl who I vaguely knew
often until 2 a.m., for about two and a had moved to New York. On the
half years, which was exhausting. The off chance, I looked her up in the
club’s opening night featured Dizzy phonebook. She said to come right
Gillespie, and we integrated Bourbon over, and when I got there, I started
Fall 2019 | 3
| FEATURE
talking to her and her boyfriend about especially if I wanted to go to Africa. Once I had my book together, it came
what I was going to do. He showed This sparked an increased enthusiasm time to find an agent.
me the help wanted ads in the and excitement in me because I saw
How did you approach that?
Sunday New York Times, and we went the whole future opening up.
through pages of them. I didn’t have By 1964, half of the U.S. was under 25
How did you eventually go from being a
experience in anything, but I knew years old, and the best and brightest
house model at Dior to revolutionizing
I never wanted to waitress again. I all seemed to be in New York. I was
the modeling industry with your Revlon
had grown contempt, and working at frequently hit on, and if someone
contract?
night scared me. There was an ad for a seemed interesting, I would make a
house modeling job at Christian Dior That was a 10-year journey. From tea date at Chock Full O’ Nuts on my
New York. The next morning, I arrived the start, I would call photographers lunch break. Dutch treat. They paid
bright and early. When my turn came, every day to see if they were looking for theirs; I paid for mine. On my 39th
they called me a “baby elephant” and for test models so that I could get free tea date, we went to dinner because
said to lose 10 pounds. I was on my shots and continue to build my book I knew he was different. He liked all
way out, and they called me back and of photos. I would have eight to nine the things I liked, and that is what I
asked if I would do it for $50 a week. appointments a day. When I look back, was looking for. I was looking for an
I accepted. I get overwhelmed! But I had a reason: athlete and a scholar, and that is what
I was going to see the world. I found.
What kept you motivated during those
early days?
Whenever I’d meet with someone, I give this background because he
We used to look at magazines while I’d ask, “When can I come back and gave me very good advice, though
waiting for the buyers from depart- show you new pictures?” Because he knew nothing about modeling.
ment stores to come in, and the other people were very upfront and often Still, he was smart about everything
woman I worked with told me that I told me that they weren’t interested. it seemed. There were only five model-
had a gap in my teeth, was short and Fortunately, I also understood that ing agencies. He told me to start with
had a funny face and not to think that I none of this was personal – it was the least revered, find out what they
could ever do photography modeling, not my soul. Often, young girls think didn’t like, fix it and work my way up.
even though those models made as people are seeing inside of them, that That’s exactly what I did. The agen-
much in an hour as I did in a week. they’re seeing their soul, but they’re cies all told me the same thing: “Lose
With that comment, my first lightbulb not. They’re often reacting to what- 10 pounds.” I did that – despite the
went off in New York. I quickly real- ever kind of day they’ve had. It’s not fact that I was living on Chock Full O’
ized I needed to make more money, personal; they don’t know you. Nuts hot dogs for lunch and 27 cent
“Often, young girls think people are
seeing inside of them, that they’re
seeing their soul, but they’re not. … It’s
not personal; they don’t know you.”
4 | Women & Wealth Magazine
chicken pot pies for dinner – and I
kept getting new pictures and seeing
more people.
I finally got to the best agency after
over a year of doing test shots and
making improvements to my book.
They instantly turned me down, and
as I was walking out, I did something
out of character. I noticed that the
agent had a picture of a boy on her
desk. I said, “Is that your son? He must
be in college. I wish I was back at
Sophie Newcomb.” For some reason,
her head shot back up, and she told
me to sit down. I had an agent.
After that, I kept getting more and
more jobs. I continued to grow and
always had a goal of what I wanted to
see and do – travel the world.
How has the industry changed over the
course of when you started to where
it is now?
When I started, the modeling indus-
try was not what it is today. It was still
a business – not an industry. There
were no modeling shows anywhere
except Paris. Everybody showed in
their showrooms.
Fall 2019 | 5
| FEATURE
and valuable. Like most of us, I was
just starting my prime time. I real-
ized I could be youthful and proud
“We lose energy with age, and of myself again if I could put women
into modeling – and that was really
the grail. So I called up every editor
we have to remember where I could.
You are now the global ambassador for
we get it from. It could be hit- StriVectin, an anti-aging skincare line.
How did that come about?
ting a museum, a movie, a bed, StriVectin was started by a husband
and wife team of biochemists who
a beach – find it, and get it.” were looking for a cure for burns and
wounds. Eventually, they realized it
worked really well when it came to
preventing aging. They also found
there were 10 types of collagen in
our face. They have about 15 prod-
ucts now that target collagen.
Almost overnight, it became about contract. At first, she pushed back,
money, which happened after I got but I wouldn’t budge. Needless to
It’s the best line I’ve ever used. It’s
the first modeling contract ever with say, I got it.
my skin medicine. I use the advanced
Revlon. Before that, there were only
retinol and layer that with the anti-
hourly jobs, and models were paid Clearly a lot of factors played into your
wrinkle serum. The first time I used
a dollar a minute. A good working success in modeling, but if you had to
it, my skin looked different almost
model had six working jobs a day at summarize them, what would they be?
instantly. You can see the difference
$60 an hour and made about $300
First, have talent for the work and the next day. Two friends asked me
in two full working days. Within three
study it every way you can. Second, what happened and what I did.
months after the Revlon contract,
work four times harder than anybody
there were no hourly jobs at any
else. Third, hope for luck. And fourth, The partnership was important to
agency, and the average day was
you must have horse strength. me because women my age and my
$1,500.
generation have been shunted aside.
Eventually, you made the move to A lot of the time, we just believe what
It was a big change. I was working
become an actress, but you came we’re told. That’s foolish, but it’s been
20 days a year, and the rest of the
back to modeling at 47. What going on since the beginning of time.
time, I traveled.
prompted that? Women need to know that we can be
beautiful at all ages. And it doesn’t
Was the contract your idea? “American Gigolo” came out when
need to be expensive – people think
I was almost 40. It was not a hit. It
Yes. I got the idea while reading an they need all these expensive prod-
became a classic much later on.
article in The New York Times about ucts and procedures, but they don’t.
My relationship was in crisis at that
Catfish Hunter, in which he said he
point, and I was taking on four or five
had to have a contract because he How do you say no to that pressure,
movies a year just to stay away from
was in a youth-oriented business. especially as you get older?
home, but I wasn’t proud of my work.
Instantly, a lightbulb went off again.
I had so many weak times where I felt
I yelled across the living room, “How
Around age 46, I decided to face my battered and bruised. But when you
can I get a contract for modeling?”
life again. It was the mid-1980s, and get weak, you need to head for what-
That same smart New Yorker didn’t
women were going into every pro- ever heals you. A lot of times, simply
even look up from his Wall Street
fession there was – except for model- calling friends gives you energy. We
Journal. He said, “Makeup compa-
ing, which was only for girls. Models lose energy with age, and we have
nies. They have the most money.
were pretty much finished by age 28, to remember where we get it from. It
Tell your photographers you want a
and that was if they were really good. could be hitting a museum, a movie,
contract. Tell your agent you won’t
There had never been any model a bed, a beach – find it, and get it.
do any more makeup ads.” I called my
over 40, but I was still healthy, alert
agent and said I wanted a makeup
6 | Women & Wealth Magazine
How has your vision of success changed
over time?
It is constantly changing. Originally, I
wanted to be the best model I could
be. I was never worried about compe-
tition, because I knew that we all were
so different. Now, it’s a little different,
because models are picked by how
many followers they have.
I would say that to be successful now,
you need to get some wisdom and find
out how you can be of use. All the prob-
lems that we see feel unsurmountable,
but you can have an impact.
You are an environmental activist.
What sparked your passion for the
environment?
Life in the wild. When I was growing up,
my mother remarried, and we moved
from Charleston, South Carolina, to a
swamp in Florida. I was so happy, and
it didn’t matter that I was no longer in
a beautiful city, because I had turtles,
alligators and snakes in the backyard.
I loved the wild, and that’s where I
learned the most. I think we learn
everything from nature.
You’ve been called everything from
unconventional to an icon. What is some-
thing that you haven’t been called that
you wish you had?
One word that comes to mind is wise.
I have had so many opportunities to
learn that other people have not, and
I feel like I should be putting my ideas
down on paper to drive more change.
What advice would you give to young
women starting out in the workforce?
Think about what moved you. What
grabbed you, helped you clear your
mind and took you away? Think about
what really interests you, because you
want to be interested for the rest of
your life.
Fall 2019 | 7
| FAMILY
Juggling Eldercare,
Childcare and Work:
Fitting In the Unpredictable
An Interview with Liz O'Donnell,
Founder of Working Daughter
By Adrienne Penta, CW&W Executive Director
Women in the sandwich generation have sent some work emails, saw my kids off assign healthcare proxies and power
long been unrecognized for their second to school, wrote and filed an article for of attorney. Think about your own
full-time job: caregiving. To increase The Huffington Post, drove more than an retirement and financial goals, and
awareness for support of caregivers hour to take my mother to the doctor, plan as best you can for how you make
and help women feel less alone in their the pharmacy and lunch, helped my space in your life and your career to
experience, Liz O’Donnell started Work- father fix something on his computer, balance family and work.
ing Daughter, a community for women drove back home (and ran over a large
balancing eldercare, career and more. branch on the way) and then went to • There is an upside to caregiving called
Founded in 2015, Working Daughter speak at an event about the challenges the caregiver’s gain. I experienced this
aims to foster this community of women working mothers face. Driving home myself and also found research to sup-
by highlighting the common challenges exhausted around 11 p.m., I thought to port it. Professors from Johns Hopkins
they all face while recognizing the long- myself, “What about the working daugh- University and University of South
term benefits. O’Donnell is also the ters? Who is taking care of us?” That’s the Florida have done interesting work
author of “Mogul, Mom, & Maid: The moment the book started writing itself. looking at the physical and emotional
Balancing Act of the Modern Woman” benefits caregivers often experience –
and, more recently, “Working Daughter: What did you learn about yourself like greater physical strength, greater
A Guide to Caring for Your Aging Par- while writing “Working Daughter”? cognitive functioning and enhanced
ents While Making a Living.” Balancing self-esteem. Caregiving is difficult and
eldercare, motherhood and a full-time I had to live the book before I wrote it. In stressful to experience, but it can be a
job, O’Donnell shared with us her story summer 2014, both of my parents were positive experience at the same time.
through it all. diagnosed with terminal illnesses on the
same day, and the rest of that year was • Your life never looks the way you
What inspired you to write “Working so intense. I dealt with doctors, man- thought it would. Planning is key for
Daughter: A Guide to Caring for Your aged moves to memory care and hos- pointing you in the direction of your
Aging Parents While Making a Living”? pice, hired an elder law attorney to sort goals, but adaptability is critical for
through wills and bills – all while trying facing challenges along the way. I
In fall 2013, I had just published my first to stay employed and present in my chil- had to let go of how I thought my life
book, “Mogul, Mom, & Maid: The Balanc- dren’s lives. Writing the book helped me was supposed to look and accept how
ing Act of the Modern Woman,” about the reflect on the experience. Here’s what it was in order to find happiness and
impact housework and childcare have on I learned: fulfillment despite the challenges.
women’s careers. While I was busy pro-
moting that book, my parents started to • There is no avoiding eldercare – What are the greatest challenges of
need more care. They were in their 80s, the only way through is through. It the working daughter experience?
and my husband and I were helping behooves everyone to start planning
them with doctor appointments, grocery for eldercare because most of us will Balancing eldercare and career is hard!
shopping, chores around the house and be called on to be caregivers at some Eldercare is unpredictable – there is no
bill pay. There was one particular day that point. Talk to your parents about their timeline to follow, and it is emotional.
started before 6 a.m. – I woke up and end-of-life goals; encourage them to Working daughters, and sons, are facing
8 | Women & Wealth Magazine“A fun way to inspire
illness, aging and end of life. Many matters most to you. Identify your children's imagination
are performing complex medi- own definition of success, be realis- and creativity!”
cal tasks when they go home at tic about where you can thrive and – Serena Williams
the end of the workday. Working where you might need to glide for
daughters often switch to a less a while, know what your long-term
demanding job, take time off or financial requirements are and then
quit work altogether to make time set your own course. Don’t worry
for caregiving duties. As a result, about how other people define suc-
they lose an average $324,044 in cess or what they think you should LEARN THE ALPHABET THROUGH FINE ART!
compensation due to caregiving. be doing. Create your own plan and
Sabrina Hahn’s latest book, “ABCs of Art,” helps parents to
We have a long way to go as a coun- adapt as you go.
spark their children’s creativity and curiosity with a delight-
try in how we support working fam-
fully curated alphabet book featuring some of the world’s most
ilies, and we are only now starting What issues do you believe need
iconic paintings.
to have meaningful conversations a spotlight? Is there a next book?
about how we support workers
In this collection, children discover artwork by Leonardo da
with parents, not just workers who We need to keep a spotlight on
Vinci, Vincent van Gogh, Mary Cassatt and many others. Parents
are parents. But I am encouraged eldercare. There are currently 44
can work with them to locate the earring in Johannes Vermeer’s
that we are starting to have those million family caregivers in the
“Girl with the Pearl Earring,” teach them different colors while
conversations. With 10,000 people United States. As I mentioned, there
examining Claude Monet’s “Water Lilies” and count the pieces
turning 65 every day in this country, are 10,000 people turning 65 every
of fruit in Paul Cézanne’s “The Basket of Apples.”
we have to. day in the United States, and we are
facing a shortage of caregivers. The
With a fun rhyming scheme and large, colorful text, “ABCs of
You mentioned your first book, AARP predicts that by 2030 we will
Art” will inspire budding art lovers as they learn the alphabet
“Mogul, Mom, & Maid: The need between 5.7 million and 6.6
and new words by finding objects in paintings. Then, as their
Balancing Act of the Modern million caregivers to support the
children grow, parents can read the playful poems aloud along-
Woman.” Does that book repre- sick and aging. Family members
side them and answer the interactive questions that accompany
sent a different chapter of your will be called on to fill that need.
each painting.
life experience? What is your best While the average caregiver is a
advice for the “modern woman” woman in her late 40s, 40% of
on how to manage the daily bal- family caregivers are men, and 25% ABOUT THE AUTHOR
ancing act? are millennials. We need to create
Sabrina Hahn is an art collector, art dealer and curator. She
policies, resources and support sys-
graduated from Harvard University with a B.A. in history of
While “Working Daughter” is part tems to help these caregivers stay
art and architecture and minor in economics and is a grad-
memoir, “Mogul, Mom, & Maid” in the workforce.
uate of the Horace Mann School. Hahn is an active sup-
isn’t about me. I was interested in
porter of artists, museums and public art installations as an
the data that showed women do As far as another book, I will know
art patron, serving on the Guggenheim Young Collectors
more housework and childcare on what it is when it starts writing
Council Acquisitions Committee and MoMA Junior Asso-
average than men, and I wanted itself. But one of the things I am
ciates. As an art influencer, she was named one of Town &
to look at how that affected their thinking about is that we can’t
Country’s T&C 50: New Modern Swans. Hahn lives in New
careers. When we talk about help- think about caregiving as an event.
York and enjoys sharing curated content on Instagram
ing women advance in their careers, Someone has a baby, takes leave
@HahnFineArt.
we tend to focus on what’s happen- and returns. The event is over.
ing in the office, but we need to Someone’s parent gets sick, they
look at what’s happening at home take time off and return. The event BACKSTORY
too. How do we support people at is over. It’s not that simple. There
Hahn cares deeply about arts education and helping to make
work and at home so that they can is a continuum of care that affects
art more accessible to people of all ages and backgrounds.
have personal lives and careers? workers. My own experience has
Art has opened up the wonders of human imagination and
And eldercare has to be part of been working mother, working
creativity to her – it has always been a unifying thread in her
that discussion. daughter, caregiver to my spouse
life and encouraged her to observe the world with a layered
and, now as a new widow, single
perspective, from childhood when she explored museums with
My best advice – whether you parent to two teens. And mine isn’t
her mother, also an art lover, through university as an art history
are raising children, caring for an an uncommon story. So how do
major delving into the creative output of artists across societies
aging or ill relative, making space we – employers and employees –
and eras. Engaging in art history introduced Hahn to diverse
to volunteer for an organization align career and care across
cultures and enriched her understanding of how people have
or issue you care about or training the continuum?
viewed and captured the world around them. Grateful for her
for a marathon – is to know what
mind-expanding experiences with art, she believes that art
can touch everyone and hopes that “ABCs of Art” will inspire
the next generation of artists and art lovers.
Fall 2019 | 9| BY THE NUMBERS
WOMEN BREAKING DOWN BARRIERS
Women are taking great strides in professional leadership: 52% of management and professional-level
positions are held by women, and 11% are top earners. In this issue’s infographic, we look at women
leaders across industries who are making history.
WOMEN IN THE C-SUITE WOMEN ON BOARDS WOMEN IN FINANCE
Organizations with gender-diverse Rise in women executives
24%
executive leadership are more in financial services over
likely to outperform on past five years
profitability and value creation
17.6%
Increase
in women
C-suite
21 %
27 %
31%
professionals
over past The financial industry has
70 years the highest percentage
of women in top positions
33
C-Suite 31%
Fortune 500 S&P 500 boards with at least
women CEOs three women directors CHRO 65%
2016 2019 CMO 53%
28
37 56
%
% %
Increase in women CIO/CTO 25%
CMOs over past
six years
Sources: “Females in the US Workforce.” Catalyst, June 5, 2019. https://www.catalyst.org/research/women-in-the-workforce-united-states/. “Guide
en-in-stem/. “The Data on Women Leaders.” Pew Research Center’s Social Demographic Trends Project, September 13, 2018. https://www.pewsoc
24, 2019. https://www.kornferry.com/institute/women-in-leadership-2019-statistics. “Women in Business: The Complete History.” All Business Sch
Science, Technology, Engineering, and Mathematics (STEM): Quick Take.” Catalyst, June 14, 2019. https://www.catalyst.org/research/women-in-sci
October 2018. https://www.mckinsey.com/featured-insights/gender-equality/women-in-the-workplace-2018. "Five takeaways from the 2019 pro
10 | Women & Wealth MagazineWOMEN IN STEM WOMEN IN RETAIL WOMEN IN EDUCATION
In 2017, women held 18% of The retail industry has the Number of women
STEM leadership roles highest percentage of women university presidents
1966 2016
CEOs 12%
27
Women
software and % inpastthe40 CFOs 19%
IT leadership years
hires rose
63%
Female-founded 9% 30%
tech companies
perform
better Modeling
and leading by
with a $ $ $ example are key
35 %
higher return
on capital than
male-founded
tech companies
U.S. women
with working
mothers earn
23 %
more than women
whose mothers
did not work
e for Women in STEM.” Discover Data Science. https://www.discoverdatascience.org/resources/guide-for-wom-
cialtrends.org/fact-sheet/the-data-on-women-leaders/. “Women C-Suite Ranks Nudge Up-a Tad.” Korn Ferry, April
hools, 2017. https://www.allbusinessschools.com/business-administration/women-in-business/. “Women in
ience-technology-engineering-and-mathematics-stem/. “Women in the Workplace 2018.” McKinsey & Company,
oxy season." EY. July 2019. https://www.ey.com/en_us/board-matters/five-takeaways-from-the-2019-proxy-season.
Fall 2019 | 11| PHIL ANTHROP Y & WEALTH PL ANNING
Resilient Estate
Planning in the Face of
Unexpected
Life Events
By Alison Hutchinson, Senior Wealth Planner, and
Stacia Kroetz, Wealth Planner, BBH Private Banking
12 | Women & Wealth MagazineS “
itting down with an estate plan- Tax efficiency in estate planning has tradi-
ning attorney means investing a tionally meant making large gifts during
significant amount of time and life, leaving everything above your remain-
energy learning technical legal ing exemption amount to your surviving
and tax strategies, options and implications.
The initial meetings will outline the value of
spouse at death and holding assets in trust,
rather than distributing them outright.
It is just as, if
trusts, how much you can give and what
vehicles can protect assets from creditors
However, there are many reasons why tra-
ditional approaches to tax efficiency might
not more,
and shelter them for heirs. These are clearly
important issues worthy of thoughtful con-
not make sense for your situation. For exam-
ple, if your plan contemplates the transfer
important that
sideration; however, at times, “estate plan-
ning fatigue” sets in, and a larger point is left
of assets to grandchildren and more remote
descendants, it is impossible to know how
the legal doc-
unstated and unaddressed: The estate plan
will mature at an unknown and unknowable
traditional planning may affect these indi-
viduals and how the plan might work for (or
uments create
moment in the future. Because it is virtually
impossible to know with certainty the point
against) them. Layering on charitable intent,
both yours and that of future generations,
a plan that is
at which an estate plan will go into effect,
it is impossible to know the exact legal and
adds complexity.
flexible enough
tax landscape in which the plan will need
to operate. Further, we cannot predict the
2. Build Flexibility into Your
Plan
to reflect your
health, well-being or financial position of
family members or unborn descendants The future is unknown. Premature death, values and
disability, natural disasters, significant finan-
who may benefit from the vehicles set up in
the estate plan. For these reasons, tax and cial success, addiction, divorce and tax law accomplish
changes are all possible future events, yet
trusts are mere pieces of a well-rounded plan.
It is just as, if not more, important that the traditional tax planning assumes all families your goals both
share the same future, goals and values.
legal documents create a plan that is flexible
enough to reflect your values and accomplish While advanced estate tax planning is a com- now and into
plex subject matter, less than 3% of failed
your goals both now and into the future. In
other words, the plan must be resilient. wealth transfers are due to poor investment, the future. In
legal or tax advice, according to a study by
1. Be Tax-Aware, Not Tax-Driven
The Williams Group. The vast majority of fail- other words, the
ures in this area, where failure is defined as a
A resilient estate plan should be informed, loss of family control over the wealth, are due plan must be
but not necessarily controlled, by tax to more nuanced causes, like the breakdown
planning. of family communication and trust, inade- resilient.”
quately prepared heirs and lack of estab-
The federal estate tax rate is currently at lished family mission, values and goals. For
40%, with an exemption of $11.4 million these reasons, where wealth preservation is
per individual transferor. The gift and gener- a goal, it is crucial to construct an estate plan
ation-skipping transfer tax rates and exemp- that enables you and your family to adjust
tions are the same. In some states, a separate as circumstances change. Without flexibility,
state-level estate tax can boost the total tax even the most technically sound estate plan
to over 50% on transfers greater than $11.4 may become obsolete in the face of reality.
million. Absent legislative change (which is
never a given), the federal exemption for A resilient estate plan may include some or
each of these taxes is scheduled to decrease all of the following features:
from $11.4 million today to approximately $5
million, indexed for inflation, on January 1, Discretionary (rather than mandatory)
2026. Clearly, tax efficiency is of major impor- distributions. A common strategy where
tance in an estate plan. an estate plan contains trusts is to direct
Fall 2019 | 13| PHIL ANTHROP Y & WEALTH PL ANNING
the trustee to pay some or all of the trust has spent down her personal assets, because
“
estate to a beneficiary when that beneficiary she feels that the beneficiaries of the trust
reaches a certain age or ages (for example, have been given enough or for any number
one-third at age 30, half at age 35 and the of other reasons. Whatever the reason or
balance at age 40). A more flexible approach change in circumstances, the ability to turn
is to provide that the trustee may make a off this tax treatment, thus making the trust
distribution to the beneficiary at any time, responsible for payment of its income taxes,
for any reason, taking into account the ben- is one way to increase the plan’s flexibility.
You can hedge eficiary’s other financial resources, goals and
life circumstances at the relevant time. This Spousal access trusts. Under current law,
against this risk of way, if, for example, a beneficiary is going spouses may transfer an unlimited amount
through a divorce at age 39, the trustee is to each other. This “marital deduction” from
loss with a robust not required to make a distribution into a estate and gift tax merely recognizes a real-
personal account that may end up outside ity of everyday life: Spouses are constantly
communication the immediate family. Giving a trustee this making transfers to and from individual and
much control over a trust fund means that joint accounts, changing the title on deeds
plan that estab- selection of the individual or institution is and transacting together and between one
critical. More on that to come. another. The Internal Revenue Service (IRS)
lishes the family’s has decided that these are not taxable trans-
Grantor trusts, with the ability to “toggle” fers worthy of reporting. However, when
mission, builds the grantor status. Another common estate an individual makes a significant transfer
planning strategy is to create trusts where to a non-spouse beneficiary, the IRS looks
and retains trust the settlor, or grantor, of the trust is required to account for and, for transfers over $11.4
to pay the trust’s income tax bill. This is a very million, tax those transfers. For this reason, a
and adequately tax-efficient strategy because it allows the common tax-efficient strategy is to transfer
trust fund to grow income tax-free for the up to $11.4 million to an irrevocable trust
prepares heirs to benefit of the trust beneficiaries. This is one for a non-spouse beneficiary or beneficia-
way of transferring assets from one genera- ries (typically, descendants). If, however, the
become stewards tion to the next that is not currently subject original transferor falls upon hard times and
to gift tax and will not use up exemption. can no longer support herself, that $11.4 mil-
of the family’s However, due to changes in circumstances, lion transfer is truly irrevocable. Her children
some grantors decide that they no longer and grandchildren may be wealthier than her
wealth.” want to be on the hook for a tax bill gener- (and they may not be interested in sharing)!
ated by a trust of which they are not a bene- If, however, her spouse was included as a
ficiary. This may happen because the grantor permissible trust beneficiary, there would
14 | Women & Wealth Magazinebe an escape hatch of sorts where the trustee could who knows you and your family well and whose
return assets to the original grantor through a dis- judgment you trust. Even more valuable would
tribution to her spouse. This is certainly not the be a letter from you to that fiduciary explaining
most tax-efficient estate plan, since assets that in nonbinding (precatory) words what you envi-
were formerly removed from the original grantor’s sion the funds should be used for and providing
taxable estate would be returned to her spouse, nor general guardrails for distributions. For example,
is it an airtight method of “saving” a transfer that “distributions should be made to support entre-
was too large (what if, for example, the original preneurial behavior, but requests for this type of
transferor divorces the spouse, or the spouse pre- distribution should be supported by a budget and
deceases her). The future is unknowable! However, business plan.”
the peace of mind in knowing that there could be a
way to get back assets in the event of a change in 3. Select Your Fiduciary with Care
financial circumstances can be incredibly valuable.
To develop a resilient estate plan, carefully con-
sider who will act as your fiduciary. Given the duties
Precatory (that is, expressing a wish or inten-
associated with the position – and in the case of
tion) rather than mandatory language within
a trustee, the level of discretion connected to a
trusts; letters of intent. Traditional estate plans
flexible, long-term trust – the choice of who will
would sometimes contain carrots for good behav-
serve in this role, and the amount of information
ior; for example, for every dollar of income the ben-
you provide to this individual or institution at the
eficiary earns, the trustee shall make a “matching”
time you create and execute the plan, might be the
distribution from the trust fund. They also occa-
most important decision you will make throughout
sionally included sticks in order to discourage “bad”
the estate planning process.
behavior – for example, distributions for uses other
than education may be made only once the bene-
First, you should understand what your fiducia-
ficiary has earned a bachelor’s degree. The values
ry’s responsibilities will include. There are many
these types of restrictions seek to encourage are
professional and procedural jobs a fiduciary must
objectively good – earning one’s own income is
complete in addition to the perhaps daunting task
rewarded (by a dollar-for-dollar increase in pay
of managing family dynamics and requests for dis-
from the trust), and education is important. How-
tributions. Every state has a different set of laws,
ever, what about a brother and sister, one of whom
but in each state, failing to fulfill one’s fiduciary
is a teacher with a low income (but contributing sig-
duties can result in a lawsuit and personal liability.
nificantly to improvement of local education) and
the other a corporate attorney with a high income
A fiduciary must review and understand the doc-
who has no time to spend it? Were the grantor alive,
ument by which she is appointed – a last will and
she might say that these two high-achieving sib-
testament or a trust agreement. This will likely
lings should receive equal distributions, or even
require some guidance from an attorney in the case
that the teacher should receive more, in order to
of an individual fiduciary. The fiduciary must also
supplement a salary that is not enough to make
identify and understand the assets of the trust or
ends meet in a high-cost city. If the restrictive lan-
estate because she will be responsible for manag-
guage is built into the actual trust agreement –
ing those assets, which may be as simple as hiring
the written document signed by the grantor and
a financial advisor to invest cash or as complicated
the trustee – the trustee may have a difficult time
as running an operating business until a competent
modifying the distribution standard. If, however,
successor is identified. Therefore, it is important to
the trust agreement provides that the trustee may
consider what your assets are and who would be
make distributions at any time for any reason, then
best positioned to manage them in your absence.
the trustee is able to make decisions about the
Filing tax returns and preparing accountings of
use of trust funds using facts the grantor did not
trust and estate activity also fall to the fiduciary
have at the time she signed the trust. This again
and will likely require professional assistance.
points to the importance of choosing a fiduciary
Fall 2019 | 15| PHIL ANTHROP Y & WEALTH PL ANNING
“
On the “softer” side, a trustee is required to with the job, as well as the values you wish to
act in the best interests of the beneficiaries, pass on to future generations through your
to be impartial to the extent there are con- estate plan.
flicting interests among beneficiaries and to
4. Identify Your Values
communicate with the beneficiaries. These
A hallmark of an duties become particularly relevant where a A hallmark of an enduring estate plan is that
trustee has authority to make discretionary it is built around core values – the “why”
enduring estate distributions to one or more beneficiaries. behind estate planning decisions.
Beneficiaries may request distributions, fight
plan is that it is amongst each other about distributions or A good place to begin is with a family time-
have differing opinions on how trust assets line, identifying how values have shaped your
built around core should be invested – and the trustee may find family’s history and listing and prioritizing
herself in the middle of these disagreements. the items that truly matter to you. What
values – the ‘why’ recurring values-based messages did you
People often name family members as hear growing up? What messages do you
behind estate fiduciaries because it is a common choice want to pass along to the next generation?
and because those are the people we trust Where do you spend your time and your
planning deci- most; however, in selecting a fiduciary, it is financial capital?
important to consider not only the profes-
sions. Therefore, sional responsibility and liability associated Next, start building a plan around those
with the position, but also the dynamic you values. For example, if you want your kids to
tax efficiency want the trustee to have with the beneficia- be philanthropic, it is best not to simply leave
ries. It may be a family member, or it may them a pool of charitable assets and expect
alone is not be a corporate fiduciary that will not face them to operate a foundation without any
personal or emotional angst as a result of prior guidance. In their younger years, com-
sufficient.” its objective decisions. One option that rep- municate about how and why you give, and
resents a middle ground is to give a family include them in your site visits and charitable
member you trust the power to remove and giving decisions. With this approach, your
replace a corporate trustee. Whatever your values will be instilled in the next generation
decision, it is good practice to communicate organically. They may take an interest in a
with the person or entity you wish to name different type of charity, but they will carry
to ensure that everyone is on the same page on your legacy of philanthropy.
about the role and responsibility associated
We believe the following six guiding principles
can help families create life-affirming, enduring,
effective wealth plans:
• Communication and trust are critical to
preserving family wealth and values
• Raising financially responsible children
is a lifelong endeavor
• Children should be allowed to take risks
and make independent decisions
• Everyone should be at the table
• Privacy should be respected, but secrets are risky
• Children learn by watching their parents
For more details, read our article that explores the six guiding principles on
bbh.com, “What We Believe: Principles of Successful Wealth Planning.”
16 | Women & Wealth Magazine5. Communicate with Your Family Choose the best time to share. Choose a
time when family members are receptive and
The estate planning process involves not
your stories will be heard.
only what goes into the plan, but what you
do with it once it is complete. In this regard,
Record your stories. As you think about
communication with family members is vital.
and share the stories that have influenced
In fact, without effective, thoughtful commu-
your values, record them in writing or
nication, your family risks losing control of
video. This process helps to preserve past
its wealth, which happens to approximately
experiences and formative moments for
70% of families by the second generation,
your descendants.
according to The Williams Group’s study refer-
enced earlier. In 97% of those cases, the loss
For more on the criticality of intergenera-
of control related to a lack of communication.
tional communication around wealth values,
Meanwhile, as noted, poor legal, tax and/or
read our fall 2017 feature article, “Love and
investment advice was to blame in just 3%
Money: Why Communicating Values Matter.”
of cases.
Conclusion
You can hedge against this risk of loss with a
robust communication plan that establishes Successful estate planning is about more
the family’s mission, builds and retains trust than tax efficiency. One way to mitigate the
and adequately prepares heirs to become unpredictable nature of the future is to create
stewards of the family’s wealth. a resilient plan that meets your family’s needs
through succeeding generations. You can
Start with storytelling. What family stories achieve this by embracing flexibility, center-
have shaped your values? Share these stories ing your plan on your values and communi-
with your children and other family members cating with your fiduciaries and your family.
to honor the experiences of those who came
before.
Create family traditions. Traditions are
a way to bring your values to life, which
helps the next generation carry them into
the future.
Fall 2019 | 17| BUSINESS & INVESTING
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18 | Women & Wealth MagazineHere are a few ways you might think about product
line extensions:
• Good, better, best. You might consider “knocking
yourself off” to pre-empt competition and to have
Grommet Makers enter their businesses with wildly an appropriate value/price point for various tiers
different ambitions about growth. Some never intend of retailers.
to leave their day job but want to have an engaging side
hustle. Some Makers know from the start that they plan • Adding SKUs. For some products, adding addi-
for their first product to be a springboard to a full-time tional SKUs is the fastest way to create an engaging
endeavor and sustainable business. Others hedge their display at retail.
bets with a “wait-and-see” attitude.
• Adding related products. Ideally you will have
Because the obstacles to growth are unique to every anticipated a full line of products right from the
company and the ambitions of the founders are equally start so that your company name and visual iden-
diverse, there are few universally true growth hacks. tity can easily accommodate line extensions. This
But for the Maker looking to scale, cycling through the is harder said than done, as so many Makers start
below pool of options is a productive place to start. with one genius problem solver and do not foresee
“what’s next.”
Create New Products
• Building exclusive SKUs. [O]ne of the most pow-
This scaling option is equal parts necessary, expensive erful tools to increase a retailer’s purchase order is
and fun. It’s fun because the joy of creating products to offer them an exclusive range of your product.
is why you get into this business in the first place. It’s
expensive, in the same way developing the original Licensing
product was. It’s necessary for a host of reasons: to stay
Some Makers take their product to a limited point of
ahead of the competition, to command more shelf
development and then license their intellectual prop-
space and thus open up retailer doors, to create more
erty to a larger company. [I]n virtually all categories of
scale in the business to cover your fixed costs. Twice the
retail, the large players who have a private-label busi-
products to sell can mean twice the revenue.
ness are actively engaged in licensing IP. Tradeshows are
the fastest and least expensive way to get a face-to-face
meeting with a potential licensor. Outside trade shows,
identifying the company matches and the right person
at the target company will require research. Contact the
legal department (they handle the backend of these
contracts), and they can refer you to the appropriate
person/team.
Fall 2019 | 19| BUSINESS & INVESTING
“My own playbook for figuring out the next moves
for The Grommet is largely based on continually
asking people in my network what is working for
them. The problems of scaling are universal, but
the solutions can be quite creative.”
Typically, Makers who gain a successful license have Trade Administration, through its U.S. Commercial Ser-
begun to produce their product and have gained some vice, operates a network of 107 Export Assistance Centers
distribution before a licensing deal will be struck. The in major cities across the country. The export and industry
licensor will quite often redesign and re-engineer the specialists employed there can help you find appropriate
product to take out costs or improve its commercial distributors in your target markets.”
appeal. They will take over its manufacturing and usu-
ally give it a new brand identity. The Maker thus puts Low(ish)-Cost Marketing Initiatives for
the future of their product in the hands of the licensor. Scaling
[S]ome options for building the business become a bit
Successfully licensing a product can open doors to sim-
more viable with growth.
ilar future licenses, and some Makers happily stay in the
realm of “serial inventor” rather than business builder.
• Hire a PR firm or consultant. A public relations firm
is an expensive option … expect to pay $5,000 a
Hire an International Distributor
month. But a part-time independent contractor
While Makers are highly variable in their use of reps for can take on your PR outreach work for a fraction
sales in their home country, it is the rare Maker who of the cost.
does not engage an international distributor. These dis-
tributors are dedicated to one or many countries and • Build a content machine. [G]enerally speaking,
have retail reach that a Maker would have a hard time content pros are affordable and a great move as
accessing on their own. The contracts can be exclusive soon as you can contract them. Just make sure their
or nonexclusive on a country-by-country basis. content execution is tied to the SEO goals you have
established for your business so that the content
Key questions to ask an international distributor include: really does drive inbound traffic to your site or to
the retailers who stock your product.
• Which brands do you represent, and what are the
sales volumes by country? • Set up an ambassadors program. Once you have
a bit of bulk in your customer list, there will be fans
• Where do you sell these products? of your company and products who will be natural
candidates to become volunteer spokespeople and
• What are the minimum sales volumes I can expect amplifiers of your mission. This effort is a cousin to a
in XYZ country? perks/rewards and referral programs. Rewards and
referrals are especially effective for a business which
• What support do you expect from me? expects a frequency of purchase.
• Will I get paid at time of shipping my goods? Raise Capital
If you have a business that is already scaling with a clear
• Ask for an example engagement contract (and get
path to profitability and an attractive set of options for
good counsel on term and termination).
an exit, taking on equity capital could become a viable
choice. However, the most frequent way Grommet
In terms of finding an international distributor, a good
Makers do this is with a series of crowdfunding cam-
place to start is with the federal government. David
paigns. These campaigns are spaced out in terms of years,
Archer, president of International Business Trainers,
not months, and require a level of attention and focus
relates, “[T]he Department of Commerce’s International
that makes the funds anything but free money.
20 | Women & Wealth MagazineDouble Down on Retail Distribution
Beyond building your wholesale business via reps, dis-
tributors, exclusive products and tiered good/better/
best product extensions, there are three other routes to
building your retail footprint.
• Pop-up stores. Holiday markets are one tradi-
tional expression of this opportunity. On a more
year-round basis, LovePop has created a network
of kiosks in train stations and malls where customers
can touch and feel their products and be constantly
updated with new designs. There is a whole indus-
try forming to fill the excess retail space across the
U.S. In addition, real estate companies building and
managing mixed use developments are looking to
enliven the streetscape of their projects and local
areas. Scaling is, by definition, a never-ending activity for the
business.
• Established retailers have started to capitalize on
their foot traffic and real estate locations by renting My own playbook for figuring out the next moves for The
space to brands. Grommet is largely based on continually asking people
in my network what is working for them. The problems
• Your own stores. Examples of DTC companies of scaling are universal, but the solutions can be quite
expanding into physical retail are rampant. While on creative. In a fast-moving world of marketing platforms,
the one hand I am convinced of the brand-building technologies and shifting consumer behaviors, we can
benefits of these shops, these companies tend to easily miss trends and opportunities. As a CEO, I find
also have deep bank accounts funded by venture myself heading out to events with a general sense of
capitalists so the economics of these stores may be dread and “I am too busy for this” and almost 100% of the
quite warped by that unusual condition. time come back with a new idea or important contact. I
have learned to trust the universe and the likely benefits
of these efforts.
And sometimes – the best times – the real magic happens
when you just try something that you haven’t seen any-
where, and that novelty or special arbitrage opportunity
puts unexpected wind in your sails, and you ride that
condition as long as you can or until others discover it.”
This article is an excerpt from Pieri’s recent book,
“How We Make Stuff Now.” For more information, visit
howwemakestuffnow.com.
Fall 2019 | 21| FIVE QUESTIONS WITH...
MAURA
CUNNINGHAM ➊ Tell us about why you decided to
form Rock The Street, Wall Street (RTSWS).
In a word, aloneness. I was often the only
woman in the room, or part of the same
small group of women each year, at national
financial industry conferences. This was true
for 25 years. After retiring from the indus-
try, I thought, “What could have been better
about my experience in finance?” And it
came to me – more female colleagues and
friends. I believe that I would be a different
person today if I had more women around
me at work, rather than always being the
sole female. In my practice, too, I noticed
that no matter how hard I tried to get my
clients’ wives or daughters interested in
the financial affairs of their family, they’d
brush it aside with a comment like, “That’s
for the men.”
I started examining the reasons behind why
there are so few women in the industry. I
went back to graduate school to pursue a
master’s degree in civic leadership, thinking
I would find out why and when girls lose
interest in finance. My thesis examined why
girls’ interest in math starts to wane at age
9 in the U.S. I researched the cultural influ-
ences behind this problem, which is unique
to America and Western Europe – they don’t
have this problem in China, Russia and East-
ern European countries. I implemented a
community solution, which was a financial
literacy program designed to re-engage
girls with math in a more tangible way.
What was once a one-time experiment is
now a national nonprofit organization with
programs in 28 high schools across 15 cities.
22 | Women & Wealth MagazineYou can also read
