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Profile of the Brumley family.

Philanthropy is and was, for the Brumley family bone deep. When the Brumleys addressed a complex philanthropic problem, they invested every form of capital available to them; a considerable treasure and commitment. The Brumleys were committed to total engagement in all that they did together.

As a tool for the successful management of capital, the investment committee has been a serious disappointment. This paper discusses the reasons why investment committees tend to subtract, rather than add, value and proposes a new approach to the use of the investment committee.

It is now becoming more common for families to focus their overall estate planning strategy on communicating a family vision expressing the philosophical and moral imperatives of the wealth creators, rather than merely on minimizing taxes. The common structure for providing incentives to encourage or alter behavior is the trust.

The decision to make a planned gift allows the donor to satisfy his/her charitable intentions without the loss of income from the securities. Unlike an outright gift, this transfer is of the remainder interest only; the donor retains the current income stream.

Family offices, by definition, are professional-staff intensive and allocate as much as 70 percent of total operating expenses to compensation costs-a significant portion of the budget. (See page 3 for information on FOX studies of wealth management costs and family office compensation.) In light of the current market environment, with markets contracting and budgets shrinking, it's time for family offices to take another look at their compensation plans. Family offices need to understand the role compensation can play in supporting family and family office goals.

Family meetings can serve to update and educate family members on business and investment issues, reinforce family ties, and resolve conflicts. They can also be a lot of fun. But figuring out how to get the family members to the event, how to keep their attention once they've arrived, and how to make it fun in the process is no easy feat.

Family Office Exchange LLC is often asked about resources that are available to teach basic concepts in money and finance. In response, we've researched some of the best Internet resources available.

Family transitions are not only difficult, but potentially explosive. Younger family members often have a high sense of anxiety because they don't know what will happen next. At the same time, those in control may be unaware that others aren't happy. Mounting tensions can cause families to delay change as long as possible, often compounding the problems.

Cousins Michael, Richard and David Horvitz told the story of their family, the birth and evolution of their individual family offices and their differing approaches to investing family assets. They also spoke of the challenges of transitioning from a trustee's office to a sibling's office and the lessons they learned along the way.