Congratulations on selling your business and acquiring new wealth! Here are five questions an entrepreneur needs to ask when setting up a family office:

What are my family's values and long-term goals? Understanding your family's values and goals is essential in creating a comprehensive wealth management plan. Do you want to invest in a specific industry or cause? Do you want to leave a legacy for future generations? Would you like to involve your family now? Would you prefer to manage the wealth without your spouse and children or do you want to be transparent about your plans? Answering these questions can help shape the structure and strategy of your family office. This part can be the stumbling block to moving forward and I recommend doing this quickly. Write down a few notes about your own attitudes to money and how you made wealth. You can come back to it and review and embellish it. Family office experts say that trying to do values to please the family can take years. Rather get something down on paper and move to step two.
What services do I need from a family office? A family office can offer a range of services beyond investment management, including philanthropy, estate planning, tax management, and family governance. Some families want to be able to ask for the administration, taxes, payment of bills, and so on, to be done for them too. Determine which services you need based on your family's specific needs. Check with your spouse who may have different preferences to add to yours. Your spouse, daughters, and sons, may have different approaches to wealth and investing. Pick investment partners who want to include your spouse and children in the conversation and who can offer alternative options to pick up on family members’ different goals. This could also include a Masterclass in investing or lunches with experts, in order to grow their knowledge. Although many men want to run the money alone and do not include their spouse, research shows you will have a much happier retirement. By including your partner, even with an annual portfolio review and lunch with your family office experts, you are giving the gift of knowledge. Teach or explain why you have selected these trusted advisors to manage the family wealth. I often have fathers dismiss their daughters’ attitudes to money as they are watching for natural curiosity and excitement over growing wealth. I believe holding back is a bit of putting the horse before the carriage. Interest and responsibility in wealth management are often not going to happen unless the father takes their offspring through a personalized “Life Lessons about Wealth” masterclass. Then miracles will happen.
How much control do I want to maintain over my investments? Family offices offer varying levels of control and involvement in the investment process. Some may prefer to take a hands-on approach, while others may prefer to delegate most of the decision-making to a professional wealth manager. Often, it is the death of a best friend that can trigger the entrepreneur to realize they need to make it simple for their beneficiaries to find their wealth and take over. Only then will they begin to transfer shared knowledge of the investments and where they are scattered. Staging the amount of control is a good option to consider. At the least, introduce your spouse and beneficiaries to your family office so that they are not left scrambling if you are not able to communicate your wishes.
How much risk am I willing to take on? As with any investment strategy, there are risks involved. Too often, entrepreneurs who are used to living with high risk every day, carry over that risk attitude to their investment portfolio. Having an expert will protect you from your own investment psychology. You will have a plan and be able to resist emotional investing with your friends to be part of their group. Determine your family's risk tolerance and work with your family office to develop a customized investment plan that aligns with your risk profile.
How do I choose the right family office for my needs? Research and evaluate potential family offices based on their expertise, experience, reputation, and fees. Consider their investment performance, client service, and alignment with your family's values and goals. A single-family office usually is set up with $100K of investable assets. Other options are multi-family offices that manage usually over ten similar families with wealth. Firms that are “asset gatherers” are also good partners as they have an investment focus and are not trying to be everything to everyone. A good fit is critical to the success of your family office.