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A family office is more than a cost-effective solution to managing great wealth. When done properly, it provides customized services and support that fosters a shared experience of wealth stewardship.

Key Considerations When Creating a Family Office PDF


Family offices provide customized services and support for a single family, typically those with assets over $250 million. They are increasingly used by those seeking to create a cost-effective wealth management process that provides quality, transparency, privacy and control.



When done properly, a family office can provide tremendous benefits. Establishing a family office should be approached the same way as creating any other successful business: start with a good plan. You and your family should work together to answer these key questions to ensure things start off on the right foot.


1. Why Is the Family Office Being Created?


The answer to this question should serve as a mission statement that guides how all future decisions regarding the family office will be made. The mission may include managing risk, controlling costs, processing information and protecting family members.


2. Who Will Be Involved in the Family Office?


While the family office typically serves wealth creators and their children, it can serve whomever you wish. Having clear guidelines will help to manage expectations and navigate challenges, especially if someone ultimately chooses to leave the family office.


3. What Services Will the Family Office Provide?


The most common services provided by family offices are based on collective access to professional advisors. The next most common service is related to information management — providing timely data and analysis to family members and family office executives is an important function of the office.


4. What Is the Appropriate Legal Entity for the Family Office and Where Will It Be Located?


The legal entity you create and where it is located is driven by the family's unique jurisdictional, regulatory and tax considerations. While there is a tendency to locate the family office where the matriarch and/or patriarch are based, it may be beneficial to consider other locations that provide access to different legal and investment opportunities.

Well-prepared families set up their family office months in advance of a specific need, such as a liquidity event associated with selling a business or the need to transfer wealth between generations.

A successful family office requires more than just a good plan. It also requires effective management that is flexible enough to adapt to changes in the family's needs.

Establish a clear mission and governance process


Having clear documentation helps to achieve desired outcomes and allows the office to adapt as needed. Capture the goals and process by which decisions are made in writing and determine how performance will be measured.

Provide ongoing education for rising generations


Family office personnel and/or external coaches should facilitate communication exercises and intergenerational activities that provide the foundation for the collaborative spirit that binds the family and supports having a family office.

Keep the family office working toward a common purpose


A regular and collaborative review of the family office's mission, its comprehensive services and operating budget promotes institutional and intergenerational trust, helping to ensure its success in the long term.

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