Morgan Stanley Launches Single Family Office Best Practices Report in Response to 10-fold Increase in Family Offices Since 2008 - Seite 2

Setup and Operations

Part two discusses the best practices for establishing and operating the family office, including the choice of legal entity, the hiring, compensation and organization of the leadership team and the selection of third-party vendors. Given the realities of dependence on technology, the important topic of cybersecurity is also addressed.

Asset Management

In the third section on Asset Management, the process of creating the family’s investment policy statement is discussed, as a clear definition of goals is critical to long-term success. Other topics addressed are art as an asset class, intergenerational wealth transfer, philanthropic issues and reporting practices and resources.

Financial Administration

Part four of the study focuses on Financial Administration. This section explores issues related to maintaining a healthy accounting, reporting and cash management system that helps protect the family from the risk of mismanagement and even fraud. Other topics addressed include bookkeeping and bill pay services, and evaluating third-party bookkeeping services.

Wealth Advisory

In part five, many wealth management issues that families face beyond investment strategies are discussed. For example, a family’s decision about how to organize its wealth and share it across generations can have huge income, gift and estate tax consequences. Being adequately insured, selecting the most appropriate trustees, and structuring philanthropic endeavors in the most cost-efficient and tax-sensitive manner can dramatically influence the success of a family’s long-term legacy. In families of great wealth, the proper and timely education of next-generation family members can have the greatest long-term impact of all.

Lifestyle Advisory and Concierge

The final section of the report focuses on utilizing Lifestyle Advisory and Concierge services. One of the most powerful benefits of having a single family office is the potential to help family members simplify their personal lives, secure the best health care, help ensure their personal safety and travel in the most convenient and comfortable fashion. A well-organized family office can optimize the many staffing decisions these service choices raise, and leave the family with the freedom to simply enjoy the benefits of their good fortune.