Origin Dictionary / OD-075
Family Office
The fortune is large. So is the administrative workload.
01Dictionary Meaning
A family office is an organization or professional service that coordinates financial affairs for a wealthy family; multi-family offices serve more than one family.
02What People Think
"It's a private team that picks investments."
03What’s Underneath
Investments may be part of the job. So may reporting, estate coordination, philanthropy, administration and organizing outside legal or tax expertise.
A family with assets in several places can receive advice that is individually sensible but poorly coordinated. Someone must understand the whole picture, identify conflicting incentives and keep decisions from falling between providers.
The office itself has costs and incentives to examine. Employing a team does not remove the need to decide who has authority and what good performance means.
04The Game
Which complexity is the office being paid to manage, who oversees it, and how are its interests aligned with the family's?
05One Line
A family office manages the decisions that the wealth creates.
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M5Family & Next Generation
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References 1
- Family Office: A Small Entity Compliance Guide
US Securities and Exchange Commission
Service models vary. The cited US source addresses a particular single-family-office regulatory category.
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