As a family business grows, so do a family’s financial complexities and overall portfolio, permitting family offices to manage their wealth. With business investments, land holdings, accounting, philanthropy, and other family needs, these offices are often used for families that need comprehensive wealth management.
A family’s approach to wealth management, focusing on increasing transparency, lowering fees, removing conflicts of interest, and striving to achieve better outcomes are key factors you should consider when making the important decision to use a family office. Wealth education, responsible inheritance, and financial stewardship should also be considered when evaluating the approach to wealth management for a family as it is the foundation for a successful financial future.
A family’s shared vision will be a driving force for the decision to establish a family office for their wealth preservation. Family offices offer a variety of services that can be customized to your unique family and help maintain a financially secure future for the next generations.
What services do family offices offer?
Family offices will advise on and organize the family’s financial information, allowing for a non-family member to make unbiased suggestions and decisions regarding the financial elements of the family.
With an extensive list of business professionals, family offices facilitate introductions to new advisors such as attorneys, accountants, and insurance brokers who are trained and equipped for family wealth management and preservation. Depending on the type of work that is needed, you will need to engage specialists to handle certain areas of your finances – family offices have the experience and the reputation to find those who will suit your needs best.
Services such as comprehensive financial and tax planning, sourcing private capital opportunities, and oversight of portfolio construction and investment allocations can all be taken care of by family offices. Making educated financial decisions often goes more smoothly with family offices because they minimize the involvement of others, allowing your family to take more objective approaches.
Another important function of a family office is handling your family’s philanthropic involvement, ensuring the money used for this area is handled properly and yearly philanthropic goals are met!
Why your family needs a family office
Mixing family and business when any amount of wealth is involved can cause strife among family members. Personal life and opinions can get in the way of people’s discernment, risking the family’s financial future, thus emphasizing the need for a family office.
Family offices provide a variety of services but their overall function is to ensure the dynamics of the family stay strong and the shared vision is brought to life, assuring wealth protection and preservation. Using an outside party that offers access to professional advisors and collectively manages information are important services of a Family Office.
Common types of family offices
Multi-family offices (MFOs) are wealth management firms that offer services to multiple families. Multi-family offices employ financial experts in a variety of fields to ensure their clients’ needs are met. This type of family office is best for families that don’t require complete control over which individuals they want working with them and don’t mind that they may work for other clients as well.
Single-family offices (SFOs) operate similarly to multi-family offices but only work for one client. They are usually owned by the family and are established to protect and grow family wealth by providing high-quality, dedicated services in a secure, confidential environment. Because of the exclusivity, they are often used by families that have net worths of over $500 million or $100 million of assets under management.
Outsourced family offices (OFOs) are operated by a third-party service provider. Instead of having one team working together to manage your family’s finances, there are multiple individuals, proficient in their fields, who provide services at a more affordable cost. This type of family office is typically used for families that do not have the assets or net worth to run their own family office but would still prefer to outsource their wealth management.
Relinquishing control over your family’s finances and assets can feel unnerving but with wealth managers and service providers within a family office, your family can focus more on protecting and growing the family’s wealth.
Meet with one of our trusted and credentialed consultants to see which family office is best for your family.
