Ultra-high-net-worth (UHNW) investors often seek management and advice from family offices. These private advisory groups offer perspective on handling large amounts of wealth, but as that wealth continues to grow, they may adopt a lifestyle management approach. Because each family’s wealth needs differ, the role of the family office can change as well. Regardless of how you define family offices, the concept offers several benefits that can help prepare families for a financially sound future. These are just a few of the ways that a family office can help your own family manage assets and life.
A Comprehensive Look At Your Assets
Family offices specialize in looking at a family’s overall financial situation to offer carefully tailored advice. Teams of experienced advisors analyze client situations to establish specific goals. These goals, always specific and measurable, align with the personal objectives of clients as well as the allowances and limitations of their unique situations. In addition to laying a strong foundation for wealth management, this strategic guidance helps clients avoid excess costs. With a family office handling your financial situation, you’ll be granted peace of mind along with future stability.
Transfer Of Inter-generational Wealth
Family offices also have the ability to assist with intergenerational wealth transfers. With more than $65 trillion in wealth expected to transfer over the next 25 years, this is an ideal reason to look into a family office. They make a point of knowing every fine detail of the family’s trust and estate planning documents while also making sure each family member is familiar with them as well. When older family members fall ill or experience cognitive decline, a family office will be there to make sure each individual is taken care of while utilizing a swift and smooth transition process should family situations and dynamics change.
Beyond simply offering advice, family office experts use their knowledge to inform clients. That education extends beyond just the wealth creators by teaching spouses, children, and grandchildren the ins and outs of handling significant wealth. In order to keep a family safe from financial trouble, family offices can prepare a monthly balance sheet to help clients keep track of assets, spending, and income. Additionally, a family office will make a point of watching out for red flags in spending habits. On the other hand, as many UHNW investors are philanthropists, family offices can provide legal and tax compliance advice. Assistance with philanthropic efforts can also extend across generations. For example, the Whittier Trust Company is assisting one of their families in creating a “junior board” for that family’s grandchildren, and Whittier will work with that board to make grant and plan decisions.
Advice From A Third Party
Families may disagree on the best methods of managing wealth. This is where a family office can act as an objective third party, giving unbiased advice on how best to handle these assets. It’s important that the family office has as much information about the family dynamic as possible in order to ensure a tactful strategy that fits them best. For example, the office may choose to provide the main wealth creator’s adult offspring a team that is closer to them in age, as a way of reassuring them that they have a reliable lifeline. Given that family offices may work with the same family over the course of several generations, there’s ample time for them to establish proper communication strategies for a given family.
Long-Term, Undivided Attention
Family offices focus on building long-term relationships with clients. When there is transparency, trust, and mutual respect between a family office and its client, the office is able to provide undivided attention, giving clients the assistance they need at the highest level. They have the capability to swiftly tackle client problems as they arise, knowing how to handle any situation that could put a family’s financial security at risk.
As asset levels rise, so can the complexity levels of different aspects of your financial life. It’s important to consider working with one in order to ensure financial security and the continuation of the family legacy. The family office is about more than just assisting with your money—it’s about making sure you and your family are secure, in every sense of the word.