A “family office” is an organization that very wealthy people and families set up to manage their personal finances and affairs. This includes not just investment management but tax planning, bill paying, estate planning, and even things like arranging for travel and personal errands. One of earliest family offices was set up by the duPont family, but much of the newer wealth, such as the Gates fortune, is also handled by a family office.
In a recent discussion among people involved in family offices we obtained some interesting insights into what the very rich are thinking and doing.
Keep in mind that, unlike the middle class, ultra-high-net-worth people are not tied to their jobs, their homes or even to any specific country. If you are worth $100 million, $500 million or several billion dollars you can live anywhere you wish, anywhere in the world. At that level of wealth, money is an accounting issue rather than a lifestyle issue. It’s simply a way of keeping score. The options open to them are virtually endless. In the past the wealthy in other countries often moved to places where taxes were lower. Today we are seeing that becoming the case with America’s wealthy.
Arie J. Korving, a CERTIFIED FINANCIAL PLANNER™ professional, has been delivering customized wealth management solutions to his clients for more than three decades. Prior to co-founding Korving & Company, he was First Vice President with UBS Wealth Management and held management positions with General Electric.