Nearly a century ago, Yellowstone National Park removed its wolves, believing the predators were wreaking havoc on livestock. The outcome was far from peaceful. Elk and deer populations surged, vegetation disappeared, and riverbanks eroded. Decades later, grey wolves were reintroduced and the park began to recover. Scientists described the effect as a trophic cascade, in which restoring one force allowed an entire system to reorganize and heal.
Michael Gold, founder and CEO of Gold Family Wealth in Westport, Connecticut, sees a direct parallel in how families manage their lives and money.
One Weak Side Affects the Whole
“When one essential condition weakens, pressure builds and instability ensues,” Gold explains. “In that state, decisions become reactive. Reactive decisions can lead to a cascade of consequences that compound quickly.” Michael Gold Westport notes that even problems with nonfinancial origins can end up carrying a financial cost, sometimes a severe one.
That belief led him to design his planning framework as a hexagon. Each side corresponds to one area of what he calls The Essential Six: partner or spouse, family, health, career, finances, and hobbies and recreation. The hexagon ranks among the most stable shapes found in nature and engineering, from honeycombs to aerospace components, because it distributes pressure evenly. Take away a side, and the structure falters. See related link for additional information.
Keeping the System Intact
The Westport advisor applies the idea to his own life through a twice-daily goal review, which he says helps him avoid overemphasizing one area at the expense of another. For clients, the same structure is meant to keep growing wealth from destabilizing everything around it.
Michael Gold describes the mission of his firm in terms of conditions rather than portfolios. “Our role isn’t simply managing wealth,” he says. “It’s maintaining the conditions that keep it stable.”
Much like the wolves in Yellowstone, the right stabilizing force can make the difference between a system that holds together and one that unravels.
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