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How to Future-Proof Your Family Dynasty

Your Family Dynasty: Will It Survive? Part 1.


Why we ask – Your Family Dynasty: Will It Survive? is because it’s a question that, in essence, every dynasty must ask of itself on a regular basis. In today’s rapidly-changing world, socially, economically and geo-politically, it is vital to ensure that all possible appropriate measures are in place to protect the family dynasty.

This is the first of a series of articles on the topic of Family Dynasties and Family Offices. In them, we shall be exploring their history, their successes and strategies and the “do’s” and “don’ts) for growing and preserving them. The success ‘rules’ apply to family dynasties and family offices of all sizes – from the multi-millionaires to the multi-billionaires. In the former category there are those who are high-net-worth-individuals (HNWI) with investable assets in excess of $1 million.

The latter category includes those commonly referred to as Ultra-high-net-worth-individuals (UHNWI) who have investable assets of at least $30 million.

What is a dynasty?

Whilst dynasties may refer to a line of hereditary rulers of a country, e.g., the Tang Dynasty or Ming Dynasty, within the context of this discussion we shall be dealing with the concept of a Family Dynasty.

A dynasty may also be referred to as a “house”, “family” or “clan”. Generally, the word “dynasty” is often used informally for people who are members of a family with influence and power in other areas, such as a series of successive owners of a major company.

Another version of a dynasty is that of a succession of people from the same family who play a prominent role in business, politics, or another field.

But first things first – the Family Office. What is a family office and what is its purpose? What are the different family office types? How do you start up and build one? 

How to Future-Proof Your Family Dynasty with image of manor house

How to Future-Proof Your Family Dynasty

Family Offices

What is a Family Office and what is its purpose?

A family office is a private wealth management firm established by a high-net-worth family or an ultra-high-net-worth family. In brief, it provides that family with a selection of personalised services that include investment management, financial planning, estate and tax planning, business succession planning, philanthropic investing, concierge services and more. Ensuring that the financial literacy of all family members, young and old, is up to speed is another vital cog in the wheel for wealth family prosperity and continuance.

The purpose of a Family Office 

The family office is a dedicated solution for the complex management of the family wealth. As such, it’s a vehicle that supports the family in the day-to-day administration and management of the family’s affairs and long-term strategy.

What are the different Family Office Types?

Traditional Family Office

A traditional family office is an entity established by a wealthy individual to manage the family’s wealth. The overarching objective is to serve the family’s  financial interests. It usually has a staff of experts who protect and grow the wealth. The staff might include a financial adviser, tax specialist, estate planner, accountant, and more. As all are employed by the family, there aren’t the conflicts of interest with products and services that might be found if they worked for other financial institutions. 

Multi-Family Office

A multi-family office is a firm that manages the wealth of more than one family. As such, it offers the same types of services that a traditional family office offers. Hence, in the same manner as the traditional family office, its experts tailor wealth-related solutions for each family’s financial and household needs.

Beyond investment management, these might involve bill-paying, transfer of wealth plans, philanthropic advice, wealth education, and more. Multi-family offices usually charge a percentage of investment portfolio assets under management for their services.

Because they work for more than one family, they can be less expensive than traditional family offices. However, a family has less control over these providers, as a result.

Outsourced Family Office

An outsourced family office is a network of appropriate service providers—financial adviser, lawyer, accountant, et al — who collaborate on behalf of a client. Typically, one of the professionals is appointed to coordinate all communication and efforts.

The fact that they’re authorised to consult with each other about one family’s financial business is what separates them from other professionals who provide the same services.

An outsourced family office can handle many of the same matters that traditional and multi-family offices handle. These might include business succession planning, philanthropic planning and family wealth education. This type of family office is usually less expensive than a traditional family office. However, the family also has far less control over the professionals.

Whichever form of Family Office is put in place, perhaps the most important consideration is the family’s choice of advisers. Naturally, relevant due diligence should be carried out in each instance prior to any appointment of a staff member / service provider.

In our next article, we shall be discussing:

  • Do you need a family office?
  • How do you start up and build a family office?
  • Is your present family office structure the best way forward for 2023 and beyond?

How FBA Can Help You With Your Family Office

At Family Business Advisory (FBA), our purpose is to help family businesses succeed on a sustainable basis. As such, we provide you with access to specialist family, business and technical services with a goal being to generate opportunities for families in business.

In order to complement our own particular specialised skills, over the past several decades, we have developed a network of trusted, professional advisers in such areas as:

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Moreover, we work at all times to give you peace of mind and proactive support to help navigate any changes in the market brought about by legislative changes, geopolitical events and general market conditions – all to maximise your personal wealth and security.

These services are provided by FBA, in association with the Wealth IQ Group.

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