Family Office FAQs

Find answers to frequently asked questions about the family office concept.

Q. What are the greatest challenges faced by family offices?

A. Here are the greatest challenges faced by family offices:

  • Succession of leadership
  • Family agreement on purpose
  • Access to strategic advice
  • “Penny-wise and pound-foolish”
  • Managing members for partnerships
  • Consolidated reporting

Q. What criteria should I use to evaluate an advisor?

A. Here are the criteria most often cited by FOX consulting clients:

  • Integrity and firm experience relevant to owner’s situation
  • Clear alignment of advisor interests with owners
  • Flexibility in supporting diverse client needs
  • Robust and accurate accountability system
  • Access to quality investment advice
  • Access to managers for alternative asset classes
  • Ability to support or serve as co-trustee or fiduciary
  • Proactive education for involved family members
  • High level of client service and responsiveness

Q. What holds a financial family together?

A. Here are the things that hold a financial family together:

  • Common and unique family heritage
  • Unified family vision of the future
  • Pooled investment opportunities
  • Multi-generation ownership structures
  • Shared philanthropic mission

Q. What legal structures are commonly used for family offices?

A. Depending on jurisdiction and purpose, the legal structure of a family office can take a variety of forms. In the United States, the most common legal structure for a family office is an LLC (33%), followed by the S Corp (20%), and C Corp (16%). Fourteen percent (14%) of U.S. offices function as part of the operating company and have no formal structure and less than 10% are structured as private trust companies.

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