Lutz Financial, an SEC Registered Investment Advisor and affiliate of Lutz, has announced that it recently surpassed the $1 billion threshold for assets under management…read more
LUTZ BUSINESS INSIGHTS
what is a family office?
lisa strutzel, family office services director
Modern family offices have been in existence since the late 19th century when John D. Rockefeller decided he needed a professional team to manage his wealth. The complexity of the financial landscape, coupled with the continuing growth of personal financial wealth, is fueling the rise in the number of family offices and the momentum is expected to continue.
Single Family Office vs. Multi-Family Office
Family offices are professional organizations established to help a family (single family office) or families (multi-family office) manage significant wealth.
The sophisticated systems and professional capability required to run a single family office equate to high operating costs, necessitating a family to be worth at least $150 million for this exclusive option to be viable. For this reason, many high net worth families are opting to use the services of multi-family offices. The multi-family office offering is a cost-effective way to receive customized services while recognizing economies of scale from pooling resources.
Sustaining Wealth from Generation to Generation
The numbers support the adage, “Shirtsleeves to shirtsleeves in three generations”, given there is over a 70 percent failure rate to transfer wealth beyond the third generation. Sustaining wealth between generations requires more than just managing money. It takes a commitment to manage the wealth as a family enterprise.
The role of the family office is to:
- Assist the family in determining its goals and priorities
- Establish processes
- Provide integrated financial solutions
An effective family office provides the “glue” which can help hold a family together through generational transitions. By supporting an organized family governance process, the family office is central in fostering family unity and engagement. As the family office knows the totality of its client’s financial situation, it can provide the integrated planning needed for sustainable wealth in concert with promoting and preserving family harmony and values.
ABOUT THE AUTHOR
LISA STRUTZEL, CPA, CAP® + FAMILY OFFICE SERVICES DIRECTOR
Lisa Strutzel is the Family Office Services Director at Lutz with over 14 years of past experience as a family office executive. She is responsible for assisting high-net-worth clients manage their family enterprise.
AREAS OF FOCUS
- Family Office Services
- Financial Reporting
- Philanthropy and Legacy Planning
- High-Net-Worth Families
AFFILIATIONS AND CREDENTIALS
- Certified Public Accountant
- Chartered Advisor in Philanthropy, CAP®
- Family Office Exchange, Integrated Wealth Advisor Council Member
- Purposeful Planning Institute, Member
- Nebraska Society of CPAs, Member
- BBA, Iowa State University, Ames, IA
- The Hope Center for Kids, Board President, Past Treasurer
- CAP Advisory Board Member
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