Who should have a family office?

A “family office”  is a dedicated group of people who handle a family’s financial, legal and tax needs, including investment management and other services.

The cost of creating and staffing a family office with experts in tax planning, legal advice, financial management and estate planning can be substantial.

“A full-service single family office is a formidable expense,” …  starting with “large” salaries for a chief investment officer and accompanying staff. CIO salaries can range from approximately $500,000 to $1 million or more, industry sources say.

Depending on who you ask, families with assets under $100 million should not consider it.  Over $500 million should definitely consider it.

But there are drawbacks, including cost as well as risk management and compliance issues in a post Dodd-Frank environment. “The analogy I like to use is the private jet,” … “It’s not the most economical way to travel, but if you can afford it, it’s pretty nice.”

If someone wins today’s Powerball jackpot, they may fall into the “maybe” category.

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