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Sunday, October 12, 2014

Family Office Services—Not Just for the Ultra-Wealthy


Between juggling board meetings, client meetings, invites to fundraisers, travel schedules and volunteering – it’s not a surprise that many Executives find it challenging to keep track of, let alone manage, their investments and complex assets.

Unfortunately in today’s high tax environment, this challenge can be costlier than ever if not addressed. These concerns have been the driving force behind a rising trend in the number of individuals and families turning to Family Office groups for support.

Until recently, only families with assets of $100 Million or more were able to create and maintain these offices. Now executives and families with assets significantly under that amount can access these services without having to create and carry the expense of their own Family Office.

What is a Family Office?
The traditional way to define the term “Family Office” is to describe it as a private company that manages the co-owned assets and investments for a single ultra-wealthy family or multiple wealthy families. This company is personally funded by the family (or families). However, this definition is a bit misleading as a full-service family office can handle much more than just investments.

Wealthy individuals that seek family office services often require a team of professionals who can assess their goals and provide the day-to-day administration and management of all their various business affairs. The modern day family office must be nimble enough to provide a range of sophisticated services like wealth planning, tax planning, estate planning and philanthropic planning while providing everyday administrative support like paying bills, reconciliations, monitoring assets, art collections, and keeping track of multiple types of insurance policies.

A family or individual may need all these services or only a selected few. Understanding and recognizing the unique personal and financial goals each individual/family has, is the first step to protecting, safeguarding and maintaining your families assets and its legacy – and simply put, this is the core responsibility of a family office.

Taking Control
Each family is unique. Some families have an international footprint, own real estate in many parts of the world, and often times end up becoming a blended family. Each one of these situations requires a unique plan. The right family office group can provide the flexibility and resources to handle whatever is needed by these diverse situations so that the individuals involved can spend their time doing the things that they love the most.

When you start to examine the limited number of hours in a day and line it up with the responsibilities a busy professional or family has – it can be quite overwhelming. There truly are not enough hours in the day or enough days in a week to get everything done. Having an advocate who can track and handle complex items and everyday financial matters allows our clients to have long-term success while achieving a happy family life. In addition, the time to live a healthy lifestyle and balance their work, community, and social responsibilities.

If you can relate to any of the following scenarios, perhaps its time to let a family office group assist you:

  • Do you have the feeling that you are not on top of your financial affairs?
  • Do you dread paying your monthly bills and reconciling your bank accounts?
  • Do you rush to get your income tax materials and documents ready at the last minute?
  • Have you been late or missed paying household bills?
  • Do you have one or more late charges for missed credit card payments?
  • Have you reviewed your trust and estate planning documents recently?
  • Do you know if your life insurance policy is performing as was originally planned?
  • Who is monitoring your financial advisor?
  • Do you have your casualty insurance reviewed on a regular basis?
  • Do you wonder if your umbrella policy is adequate?

Our family wealth team has handled these types of situations and many others that are far more complex. With our help we can eliminate costly and stressful situations and enable individuals to take back control of how they spend their free time.

Is it time for a document tune-up?
With wealth comes a myriad of financial documents that must be maintained and kept up to date. This complicated and time consuming task is often overlooked and it is only when you run into a problem that you realize something was missed. Wouldn’t it be nice if all of the financial documentation that must be kept up to date were equipped with a “check-engine” light when they expired or become out of sync with new tax legislation?

When my “check-engine” light comes on in my car, I wouldn’t dream of trying to fix it myself. I take my car to the mechanic. If you are worried that your personal financial documents (like trusts or insurance policies) are out of date, wouldn’t you feel more comfortable having a family wealth professional handle whatever repairs need to be made to these important documents?

If your answer is “yes”, then perhaps it is time to request a document “tune-up” from your financial advisors. A thorough review of all your important documents can ensure that there are no hidden risks and that they accurately express your wishes about how you want your estate to be managed.

We understand our clients are busy professionals and successful families whose hectic lives do not allow them to focus on overseeing and managing their assets, let alone understand the complexities of the tax and estate laws. Our family wealth group has the years of experience, knowledge and capability that will enable us to uncover any hidden or potential risks you may have and give you the peace of mind that you have everything in place in order to focus on more important things – like spending more time with your family.

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