Family offices specialise in offering financial management, typically to ultra-high worth families. Services that these private wealth management firms offer include insurance, wealth transfer, trust services, investment and tax services.
Since the financial crisis in 2008, the number of single-family offices has almost doubled worldwide.
This financial crisis resulted in many people losing confidence in private banks, the main competitors for a family office. Now wealthy individuals appear to be increasingly in favour of employing family offices. According to industry experts, in 2016, it was estimated there were between 10,000 to 11,000 single family offices worldwide, with combined investable assets of several trillion pounds. However, due to the elusive nature of the industry, it is hard to determine exact figures. In the UK many single-family offices are not required to register with the Financial Conduct Authority. In the USA, family offices do not need to be registered or licenced either making the scope of these firms hard to decipher.
The single-family office
As the title suggests, these offices serve a single ultra-affluent family. The structure and function of single-family offices are ambiguous; this is because the individual interests of each family drive the service and no family is the same. Typically, to afford a single-family office, the wealth of a family’s investable assets must exceed £100 million. However commonly, this figure is closer to £250 million, with the wealthiest clients investing billions – for example, Bill Gates has a family office.
The multi-family office
These offices serve many clients instead of an individual family. Multi-family offices can offer a broader range of services as they can share overhead costs between numerous families. This makes this type of family office a better option for families who want to invest less. Multi-family office practices are closer to traditional wealth management practices. However, the structure and function of these offices are also hard to define. This is because many multi-family offices have evolved from different backgrounds. For example, sometimes single-family offices expand or entities such as law firms can choose to specialise in serving the ultra-wealthy.
Effectively, there is no ‘one size fits all’ when it comes to family office. Every family is different and will require personalised services. If you are looking into using a family office to manage your family fortune, it can be worth spending time researching the market thoroughly – and remember to check that they are regulated by the relevant authorised bodies.
The benefits of having a family office
They serve as a central source of information and can advise on all aspects of family wealth
Family offices specialise in services relevant to their clientele. Professionals who work in the family office are familiar with the usual client profiles, assets and investment preferences
Family offices are more efficient than traditional firms as resources are usually under one roof
Traditionally, family offices were designed to cater for ultra-high net worth individuals with vast fortunes. In modern days, family office services are available from many professional service firms such as law firms, accountancy firms, and investment consultants.
By offering a range of additional services on top of the family office, these firms are better equipped to serve the ‘average’ family. At More Group we offer family office services, these are not just used by ultra-high net worth families but also by families with property and business locally or abroad. If you have assets in your family that you want to manage, then our experts can help you to secure the financial future you desire.
Note: The information should not be construed as legal or other advice as it designed as an information source only © More Group 2018. All rights reserved.