Choosing a Family Office

Do I need a family office? Does it make sense to build and manage my own office? How would I be served by a multi-family office?

Review the following checklist to gauge your need for the integrated services of a family office.

Financial Planning

My financial affairs are in good order and I have the ability to allow selected family members easy and secure access to my financial records.
My family’s long-term goals are well defined and quantifiable.
I receive regular, easy to understand, consolidated reporting on all family assets, across all our entities, for all family members.
My advisor is proactive and regularly anticipates my family’s needs. I understand the fees I am paying to my advisors and the value I receive from their advice.

I know exactly how much capital I will need to retire and maintain my/my family’s standard of living.
I have a good understanding of my family’s current expenses and feel confident they are manageable over the long term.

My family has frequent and healthy dialogue regarding the management of our shared assets.
I am confident my family’s values are known to my heirs and will be passed on to future generations.
I am confident that my spouse or children will be able to manage if I were to die unexpectedly.
I feel comfortable that my children are financially well educated and sufficiently responsible to inherit their future assets.
I am comfortable that my family will be well protected if one of my children gets divorced.

I have a written Investment Policy Statement for my portfolio, clearly stating my objectives and limitations.
I have a consistent review process in place and evaluate the success of my investments against relevant benchmarks.
I am comfortable that my asset allocation is appropriate for both my long-term goals and my risk tolerance.
I know I am well diversified and not overly reliant on one particular investment/asset class.
I know the rate of return I need from my investments to ensure my family’s long-term objectives.

I am confident I am taking advantage of all tax efficiencies available to me personally and to my estate.
I am confident that the tax location of our investment assets is optimal, as is my state of residence.
I understand how the use of trusts affects the taxes I pay.
I am confident my current advisors are considering tax efficiency when making investment recommendations.

I am confident my estate plan accurately reflects my objectives.
I am confident that my designated heirs will receive my gifts without contest and that the distribution schedule and conditions are in their best interest.
I believe my chosen trustee(s) will remain independent and have the ability to execute my wishes.
My current advisor(s) regularly update me regarding tax law changes and how they may affect my estate.
My will has been updated within the past three years and I have properly executed powers of attorney for financial and health care purposes.

As an owner of a closely held business, I am confident I am adequately preparing the next generation to take control of the company.
I anticipate a liquidity event (deferred compensation, selling partnership interests or family-held business), and I am confident that my current team of advisors is working together to ensure the event is handled in a manner that is tax efficient, in the best interest of my heirs, and reflective of my philanthropic goals.

To print a copy of the checklist, click on the link below:
FO Assessment Quiz