Family Office Setup - What you need to know
Family offices have been around for a while. However, what’s new is the growing demand for their establishment and the availability of these services offered by financial advisory firms across the world. Although the term “Family office” has European roots dating back to the 1800’s, the actual theory was officially established and conceptualized in the U.S by the notorious House of Morgan and the Rockefellers families.
With today’s bustling business scene, which includes increased multi-billion-dollar industries evolving at a quick rate, it’s no surprise that there’s been a significant increase in the growing number of high net worth individuals worldwide. This is the key driver behind the surge of Family offices today. Other fundamental factors include increased globalization and a wide range of endless investment options to choose from, in addition to the need to focus on multi-generational wealth preservation and succession planning; all requiring expert counsel.
So, what exactly is a Family office?
The term Family office has many variations and can be used within a range of different frameworks. Originally, they were created to preserve a family’s wealth and legacy. Today’s modern day Family office has significantly evolved beyond just wealth preservation; now serving as a one- stop- shop where its members make business and investment dealings that were conventionally set aside for big companies or private-equity businesses, hence becoming an explosive force in the global transactions market. Also, large families today with growing wealth now require a rising number of adaptive and agile services that go beyond just dealing with business administration and lifestyle requirement needs. As a result, Family office staff now comprise of a team of highly skilled experts that include investment advisors and finance specialists, lawyers, property executives, asset managers, philanthropy directors and more.
Formula for Success
As Financial advisors we all agree that key to success is to develop responsive strategies on behalf of our clients. Another essential factor is the ability to form strong relations with clients in order to achieve an all- encompassing understanding of their needs and requirements, as no two families’ financial objectives are alike. Additionally, setting up a Family office must be approached holistically in order to provide families with exclusive bespoke services. Therefore, appointed advisors play a pivotal role in supporting their clients by helping them carefully plan for the future through succession preparation and sustained family involvement. This offers high net worth families the advantage of increasing their fortune as they preserve their legacy and wealth for the generations to come.