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Is a family office right for you?

By Brian E. Ravencraft, CPA, CGMA is a Principal with Holbrook & Manter, CPAs

Brian E. Ravencraft, CPA, CGMA is a Principal with Holbrook & Manter, CPAs

A family office isn’t what you might think it is. It is not the office you use at home to take care of family matters. It isn’t the office the you use to run your family business. A family office is essentially a private team of professionals dedicated to managing the finances of a wealthier family and high net-worth individuals. These wealth management entities help steer a family’s investments in the right direction and, in the United States, they are rapidly growing in popularity.

Family offices are typically classified into three different classes depending on which services they offer:

  • Class A: Comprehensive financial oversight, estate management and objective fiscal consulting for a flat monthly fee.
  • Class B: Investment advice and consulting for an as-needed fee, but does not directly manage illiquid assets.
  • Class C: Basic estate and administrative (bookkeeping, mail sorting, etc.) and is run directly by the family.

Most family offices provide the following services:

  • Investment management
  • Wealth transfer management
  • Business advising & consulting
  • Estate planning
  • Education planning
  • Philanthropy & charity management
  • Bookkeeping, record keeping, reporting & communications
  • Legal, compliance & tax advising
  • Investment risk management.

Working within the confines of a family office could help you avoid certain financial mistakes such as:

  • Making any contractual moves and major decisions without a lawyer’s review
  • Rushing into investments without performing in-depth research and leaning too heavily on third parties outside of the family for guidance
  • Investing your money into ventures that have stalled or shown signs of failure
  • Not balancing the objective best interests of the family, as a whole, with the voices of a few key influencers’ passions within the family
  • Not having a clear exit strategy for both well-performing assets and poorly-producing investments

If you would like to learn more about family office services and if they would be a right fit for you, please reach out to me with any questions.

 

Brian E. Ravencraft, CPA, CGMA is a Principal with Holbrook & Manter, CPAs. Brian has been with Holbrook & Manter since 1995, primarily focusing on the areas of Tax Consulting and Management Advisory Services within several firm service areas, focusing on agri-business and closely held businesses and their owners. Holbrook & Manter is a professional services firm founded in 1919 and we are unique in that we offer the resources of a large firm without compromising the focused and responsive personal attention that each client deserves. You can reach Brian through www.HolbrookManter.com or at BRavencraft@HolbrookManter.com.

 

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