DO I NEED A FAMILY OFFICE?

AS WEALTH GROWS, SO DOES THE COMPLEXITY OF MANAGING AND PRESERVING IT.

The term “family office” may conjure up an image of family members operating a business together.

To the ultra-high net worth (UHNW) family, the term family office has a much broader definition. A family office is an organization that assumes the day-to-day administration and management of a family or ultra-high net worth individual’s affairs. A family office provides a range of investing, planning, and concierge services bespoke to ultra-high net worth individuals.

Read our guide “5 Questions to Ask Yourself When Considering a Family Office” filled with suggestions to help you to answer, “Do I need a family office?”

Most often, UHNW individuals choose to join a family office to invest assets generated by a significant liquidity event, such as the sale of a family business or inheritance.

Learn more about different investor examples below.

Business Exit

BUSINESS EXIT

When you realize it’s time to transition your business.

Amid the stress and volatility of a fast-growing private company, business owners need help in considering all of their options as they prepare to sell their business and consider new ventures. A multi-family office harnesses the power of a team of domain experts to walk the client through numerous exit/sale scenarios and how that sale would impact not only their balance sheet but also the lives of their employees. The goal is for the client to enter the sale process fully engaged and educated about available options as well as the transactional nature of other advisors’ roles (Investment Bankers/Tax/Legal). A multi-family office will set up and manage a transition team to keep all those involved focused on optimizing “net outcome” for the client. From tax to legal to insurance, as well as personal bookkeeping and lifestyle coaches, all advisors need to be consulted well ahead of the transaction so that the business is left on a strong growth trajectory. In addition to extensive pre-planning in an effort to maximize the client’s net outcome, the key is to have a team with a solid plan in place for growing and protecting the new capital well before the business proceeds are wired to their account.

INHERITOR

Establishing a path forward.

When the head of a family passes away, the next generation not only has to deal with the grief associated with their loss but can also be overwhelmed by their inheritance and all that comes with it. In addition to settling a sizable estate, the inheritor also needs to determine who they will partner with going forward as they attempt to manage all of the complexity associated with their new wealth. In many cases, they may already have a financial advisor and tax accountant but they should take a moment to consider if they need someone to manage all of their personal and financial affairs. A multi-family-office can help them coordinate external legal, tax, and insurance advisors, provide concierge services, plan for the future from an estate and philanthropic standpoint, as well as help them to invest in an intelligent manner. Once a family’s wealth has been passed down, the current generation is called upon to step up and continue their legacy which often requires a team of dedicated subject matter experts.

DISCIPLINED SAVER

It takes years to become an “overnight success”.

A popular quote from many successful professionals is that it took them years to become an “overnight success”. Though some people come into wealth overnight through a business exit or inheritance, there is another group of high-net-worth families who simply worked hard to accumulate significant assets over time and then invested them wisely. For many of them who were accustomed to working long hours and juggling multiple tasks at once, they managed their own personal and financial affairs as they created wealth over time. Now they have reached a point in life when they have realized that life is short and they want to focus on spending more time with family, traveling the world, focusing on having a greater impact via a charitable cause, or starting a new business venture. A multi-family office enables a disciplined saver to pass off all of the stress of managing portfolios, external advisors, a family’s lifestyle, and its legacy so that they can truly enjoy the fruits of their lifetime of hard work.

If your time is consumed by the duties required to manage your personal wealth, leaving less time for your life experiences—like travel, spending time with your family, sports, philanthropy, or your next business venture—
a qualified family office can be transformative.

Your family office should be driven by primary goals:

Align your family’s interests

Build a sophisticated and robust investment plan to preserve and grow your assets

Enhance communication and cooperation among your loved ones

Simplify your daily to-do list

Advice for generations.