Understanding Wealth Management

January 15, 2017
 
We are often asked about the tiering of the wealth management industry.  When does a family outgrow the services of retail wealth management and find itself in a position to consider the services of a multi-family office?  When does a family outgrow a multi-family office and consider building its own single-family office?  Here’s our quick guide:
Multi-Family Office
Asset Range: $25M to $100M
Benefits: Personal wealth management services, tax advisement, education, governance, philanthropic advisement, and fiduciary responsibility.
Examples: GenSpring Family Offices, Abbot Downing, Bessemer Trust, Hawthorn, Silvercrest

Single Family Office
Asset Range: $100M+
Benefits:  The singular focus of one family is the primary benefit of the operation. The services provided include property management, accounting, payroll, and management of legal affairs, family governance, financial and investment education, philanthropy coordination, succession planning management of household staff, and making travel arrangements.
Industry Outlook: Over 4,000 different SFOs in the United States and growing.

Leading multi-family offices

September 29, 2016
 
For many wealthy individuals and successful business owners, choosing a wealth management firm can be one of the most formative decisions they make on behalf of their families. For the very wealthy, however, preserving and growing wealth often requires more than just the management of wealth. If you’re in this elite group, it may be worth looking into a multi-family office. Multi-family offices offer wealth management in addition to a number of adjacent services to their clients. These services can include tax and estate planning, trusteeship, lifestyle advisement, and philanthropic advisement, among others. Below, we profile four leading multi-family offices.

Bessemer Trust has served families of substantial wealth for over 100 years. Like the Abernathy Group II, Bessemer is privately owned and able to offer independent, objective advice. They invest side-by-side with clients and align their interests with those of their clients. Bessemer offers services such as legacy planning, tax advisement, family wealth stewardship, family company advisement, insurance advisement, philanthropic advisement, and concierge services.

Convergent Wealth Advisors was founded in 1994 as a single family office for a Washington D.C. family, and has since grown into a nationwide, specialized multi-family office. They focus entirely on the financial and wealth planning needs of their clients, and refer to themselves as The Financial Family Office. They help their client families with asset allocation, investment manager selection, manager due diligence, tax planning, converting concentrated portfolios into diversified portfolios, estate planning, charitable planning, and asset safeguarding. Convergent is owned by Royal Bank of Canada.

GenSpring Family Offices was founded as a multi-family office in 1989 by a group of like-minded families. GenSpring focuses on what they describe as the ten elements of a family office: Expense management, tax planning, document management, investment management, family governance, education, philanthropic advisement, estate planning, fiduciary duties, and lifestyle planning and advisement. They emphasize their low client-to-adviser ratio, and their comprehensive governance and education programs designed to not only preserve but grow wealth over multiple generations. These programs include one-on-one financial education for children as young as five, educational conferences for the women in their client families, succession planning, and family governance system development.

Pitcairn was founded in 1923, with the singular mission of sustaining generational wealth. Initially a single family office, Pitcairn now operates as a multi-family office that works with families to design, implement, and oversee individually customized strategies to achieve this goal. They manage assets guided by the principle: “Invest with families in mind,” and also offer fiduciary planning, administrative services to help make their clients’ lives simpler, and support for family philanthropy. They are owner-operated, and strive to provide integrity and objectivity in order to empower their clients.