In all walks of life, the family is a powerful unit. Today, a growing number of families are putting that power to work by adopting family mission statements. Also known as a family constitution, strategic plan or code of conduct, such a statement can be a valuable first step toward uniting everyone in a family around goals and the actions needed to make them a reality. "Businesses have used mission statements to define a common purpose and as anchoring points for many years — and that's exactly the way families are using them now," explains Stacy Allred, director of the Wealth Structuring Group at Merrill Lynch.

Some families look for ways to ensure that future generations will inherit values along with money, or they may seek to build a philanthropic legacy. Co-owners of a family business or a large estate may hope to prevent conflicts, or may prescribe a method of resolving any that arise. A mission statement can provide foundational concepts that help clarify many decisions down the line. For example, it can begin to outline the way your family wants its money to be used — whether for education, entrepreneurship or philanthropy.

"Every family can benefit from a mission statement, regardless of level of wealth," Allred says. "Coming together behind a shared purpose strengthens the bonds within the family and also guides the family and individual members through daily and major life decisions to help realize its goals." The statement can also be an ideal way to begin teaching younger members of a family about making financially and socially responsible decisions.

Family statements can come in all shapes and sizes, but there are rules of thumb that all families should keep in mind. Here, Allred outlines eight steps to creating an effective family mission statement.

1. Involve everyone. Ideally, the entire family should have a hand in developing the mission statement. "Even young kids should be involved so they have first-hand experience of being part of the discussion," Allred says. "That's how you ensure everyone's buy-in, which is really important — especially for the next generation."

2. Define your values. Ask each family member: "What would you like this family to stand for? What are your aspirations for the family as a whole and for yourself?" Family values can range from overarching characteristics — integrity, strong work ethic, giving back — to more personal, experience-based considerations, Allred says, who notes that ensuring that a family legacy serves as a positive force for family members is a common consideration. "There are plenty of ways that money can get in the way of growth and development. Being clear on the purpose of money in your family can help ensure that doesn't happen," she explains.

3. Think ahead. Consider your family's long-term goals. "It's hard to come up with a mission statement without envisioning the future," Allred says. "Look at long-term and even longer-term goals, from a decade to 30 years. What do you want for your family at those times? What kind of legacy do you want to leave them? That will give you a stronger sense of your goals and your time horizons for the entire family."

4. Keep it focused. Work together to summarize the values and goals you've defined in a crisp and memorable statement — ideally a single sentence or short paragraph. Ultimately, you're looking to create a statement general enough to be timeless, yet specific enough to apply to real-life issues. If you have more ground to cover, the overarching statement can be supplemented with a list of supporting values or guidelines. For example, wealthier families may want to make provisions for resolving conflicts among heirs to an estate, while families with a business may include a framework for distributing profits and making major decisions.

5. Check your authenticity. Just as sometimes happens with companies, it's all too easy for a family to create a feel-good mission statement that simply gathers dust on the wall. To be effective, your statement needs to be authentic, Allred says. In other words, don't just craft a statement because it sounds nice. "It needs to be in your words and language — to sound like you — and to be something you really believe in," she notes. "It can be a stretch, something you aspire to, but it should reflect values you are currently living and striving for."

6. Keep it front and center. Whether you frame and mount your mission statement or simply post it on the refrigerator, it's important to have it on hand. "This is a dynamic document — you should be reading it and using it," Allred says. She suggests reviewing your family's statement when weighing life-altering decisions, such as a job change or major financial investment. "It should not just sit on the shelf."

7. Put it into action. The "use it or lose it" maxim applies here — to realize the goals you've had in creating your mission statement, you'll need to make it part of your planning and decision making on a regular basis. Beyond the statement of the mission itself, it can also assist in creating a list of values or a governance procedure that can help you adhere to the statement. For example, a family whose mission statement centers on making education a priority for future generations can then, with the help of a Financial Advisor, create further, more specific guidance toward making savings and investing decisions. It also helps to get in the habit of asking yourself how the plans that you're making — a career change, an investment decision, community involvement — fit your values. Some families even hold brief weekly meetings to discuss issues of concern to individual family members, using their mission statement and attendant guidance in counseling one another.

8. Revisit and revise annually. Even if you're not holding weekly meetings, plan to get together annually as a family to discuss the mission and gauge family members' success in achieving their goals. "Some families make a Thanksgiving tradition of discussing how the family is doing," Allred says, who explains that mission statements may need to be updated as families evolve. "Things change and so do families — children grow up, get married and have children. As time passes, you want to make sure the mission statement remains authentic and continues to reflect the values of your evolving family."