What is Family Wealth Management?

Family wealth management is a financial service offered to families with substantial assets to assist them with the handling and disposition of those assets. A representative like an accountant, attorney, or personal finance advisor maintains records on family assets and advises family members on the most efficient and effective ways to handle their funds, real estate, and other assets. Fees for these services generally are bases on the size of the account and level of involvement required.

Management of large holdings can eat up substantial amounts of time. Some wealthy families prefer not to be involved in the administrative side of things, and may turn decision making and daily tasks over to a financial services professional. Families with extensive wealth spanning multiple generations may not be able to administer their assets on their own, as this can involve tax paperwork, daily decisions, and a wide variety of other activities. Allowing a financial professional to handle the management of assets can save time for the family, as well as improve the assets in some cases, since they are being handled by someone with proper skills and experience.

Family wealth management can include helping people minimize their tax liability in a given year, making investment recommendations, handling transfers and sales of assets, and assisting people with the development of wills and trusts. Keeping wealth in the family is usually one of the aims of family wealth management. Structuring wills, trusts, and accounts in particular ways can reduce the amount lost to taxes and fees, allowing families to consolidate and control their wealth more effectively.

Financial planning services are also an aspect of family wealth management. Families plan ahead for eventualities like paying for college, making upgrades on existing assets, and expanding family companies and holdings. Making strategic plans ahead of time can be advised in situations where large amounts of money are involved. Funds can be set aside in trusts and other types of accounts so they will be available when needed and can be transferred with minimal inconvenience.

Some family wealth management services only focus on very high net worth families. Others may handle smaller accounts, including families with relatively limited assets who need help growing and maintaining their assets. Families who don't have need of wealth management services can often still benefit from financial advice provided by consultants or accountants, who can help them make decisions about how and where to use their money to maximize returns with investments, insurance policies, and other things.