Mr Family Office Profile picture
Feb 15, 2023 9 tweets 3 min read Read on X
GENERATIONAL WEALTH is the practice of passing down significant financial resources to future generations. But 70% of wealthy families will lose their wealth by the second generation and 90% by the third.

Why does this happen and how do Family Offices prevent this:🧵 Image
Generations are taught not to talk about money, so the next generation may have no idea about the value of money or how to handle it.

This may be driven by worries that the next generation will become lazy and entitled, so wealth is kept a secret.
The next generation grows up in a life of plenty and may not understand the struggles and sacrifices of the previous generations.

Building wealth takes hard work and discipline. The further you are away from that, the more difficult it is to understand.
Family Offices have excelled at building multi-generational wealth... here's how:

Open communication is key. 📢

Preparing the next generation for what they can expect is critical, and introducing a wealth expert/advisor can help facilitate a productive discussion.
Sharing decision-making: beneficiaries of family wealth should be involved in the decision-making process to ensure they have the skills and understanding needed to maintain and grow the wealth.
The use of trustees: an objective third-party point of view can mediate over emotional attachments and ensure the wealth is properly managed and distributed.
Planning: Family offices develop a clear goal and roadmap for how the wealth should be managed and invested for future generations.
Passing on family wealth beyond the third generation is challenging, but investing wisely, developing a good estate plan, and educating the next generations can help sustain the family and the fortune.

Whether you have $100M or $100k, education and communication are key. 👩‍🏫📢
For more on wealth, family offices and finance, please like, follow and let me know what you think!

@MrFamilyOffice

#Generationalwealth #wealth #wealthmanagement #FamilyOffice

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More from @MrFamilyOffice

Jan 8
If you provide services to family offices, you need to know what is outsourced and what is done in-house

Here's a summary, including a breakdown by AUM:
1. Financial Asset Management

$50M to $500M AUMImage
$501M - $999M AUM Image
Read 14 tweets
Dec 21, 2024
The wealthiest families in the world hold secrets that are passed down through the generations

Educational secrets that even the most exclusive schools don’t teach

Wealthy families rarely rely on schools to teach kids about finance

Family offices curate exclusive financial education programs. Programs delivered through private agencies, Ivy League universities and specialist organizations

12 lessons on financial education from Family Offices:

(and tips for any family)

🧵
Lesson 1: be open

Successful UHNW multi-generational families talk about money. They are not coy

It’s part of everyday life to talk about business, wealth and money. Business-talk at the dinner table is encouraged

Wealth brings opportunities and problems. But if wealth is a taboo subject, opportunities will be missed and problems exacerbated

A lot of people think they are helping their kids by shielding them from financial matters. But like any topic, to master it, you need to be consistently exposed to it
Lesson 2: start young

That doesn’t mean telling wealthy toddlers their net worth

It means teaching kids about:

- the history of the family wealth
- the scope of the wealth
- the family values

As they get older, focus can shift to areas such as budgeting and saving. Then investing, tax, credit, finance, philanthropy

Kindergartens and schools don’t teach finance... It’s on you
Read 14 tweets
Dec 19, 2024
UBS interviewed 82 billionaires

Here's what they said about:

• the regions they're investing in
• their asset allocation shifts

1. where billionaires are investing

80% of billionaires see North America as the best investment opportunity over the next 12 months, up 30% from 2023

68% maintain confidence in North America over the next five years

Asia-Pacific (excl. China): 25% short-term optimism, rising to 45% over five years

China: 11% short-term optimism, increasing to 31% over five years

Western Europe: 18% short-term optimism, climbing to 29% over five years

Regions like Middle East, Latin America, Eastern Europe, and Africa are seen as having limited short- and medium-term opportunities

North America Dominance: driven by technological innovation (generative AI, GLP-1 drugs) and energy security, billionaires favor North America for both short- and long-term returns

Shifting Views on APAC and China: short-term confidence in Asia-Pacific and China is muted, but expectations grow over five years

Western Europe’s Moderate Rise: investment sentiment strengthens moderately for Western Europe over the medium termImage
2. what billionaires plan to invest in

Billionaires' asset allocation shifts:

43% plan to increase exposure to real estate

42% plan to increase exposure to developed market equities

40% intend to increase gold/precious metals exposure

31% plan to increase cash holdings

Interest rate easing:

Views on asset classes are changing as interest rates in the US and Europe may start easing, potentially boosting economic growth

Alternative investments: 38% plan to increase direct private equity holdings

28% plan to increase private equity funds/funds of funds, while 34% plan to decrease

26% intend to increase infrastructure investments

35% plan to increase private debt

Hedge funds are less favored: 27% plan to decrease, while 23% aim to increase

Art and antiques: 32% plan to increase exposure to art and antiques, a significant rise from 11% the previous yearImage
source: UBS Billionaire Survey, 2024

More than 5,000 family office people subscribe to the free Mr Family Office Newsletter

Stay ahead of the curve: sign up link below
Read 4 tweets
Oct 22, 2024
what is a family office:
A single-family office (SFO) is a private wealth management firm supporting a single affluent family

It manages investments, tax planning, legal support & other financial matters

Core roles:

1. Protecting wealth
2. Growing wealth
3. Financial Planning
4. Succession Planning
5. Administration
6. Charity and philanthropy
7. Governance
1. Protecting wealth

"I don't want to get rich, I want to stay rich"

Protecting wealth is traditionally the raison d'etre of the FO, it involves:

• Creating trusts and other legal structures, to preserve wealth within the family and shielding it from outsiders, former spouses, tax authorities
• Continuous monitoring of investments and the market to identify and mitigate potential dangers
• Implementing diversification strategies
Read 10 tweets
Sep 10, 2024
Deloitte Private released a major family office report this week

8 key takeaways
Some truly mind-blowing numbers ↓↓
1. Family office expansion explodes

• 8,030 single family offices globally today, up from 6,130 in 2019 (31% increase)
• Projected growth: 12% to 9,030 family offices next year
• Expected increase of 33% to 10,720 family offices by 2030
• This represents a 75% increase over a 10-year period
2. Family offices are becoming an economic powerhouse

• In 2019, total wealth for families with family offices was $3.3 trillion
• Today, it stands at $5.5 trillion (67% increase over five years)
• Projected growth: $6.9 trillion by 2025 (26% increase)
• $9.5 trillion by 2030 (73% increase from today, 189% increase from 2019)
• Family offices' total AUM is $3.1 trillion today, expected to rise to $5.4 trillion by 2030 (73% increase)
• North America is projected to see the greatest increase in family wealth and AUM, with a 258% rise by 2030, followed by Asia Pacific at 208%
Read 10 tweets
Aug 18, 2024
Family Office pay (non-execs), a thread: Image
Portfolio Managers

Focus on growing and preserving the family's wealth through diversified investments in equities, real estate, private equity, and hedge funds

Salary Range: (total compensation by AUM, 25th percentile - 75th percentile, US)

Less than $500 million: $185,000 - $279,375
$500mn - $999 million: $201,250 - $373,750
$1bn - $2.49 billion: $266,251 - $514,000
$2.5 billion+: $324,608 - $643,716

Background: investment management, financial analysis, or related fields. They may come from investment banks, asset management firms, or other family offices
Investment Analysts

Conduct research and analysis to support investment decisions

Salary Range: (total compensation by AUM, 25th percentile - 75th percentile, US)

Less than $1 billion: $134,250 - $189,714
$1bn - $2.49 billion: $137,325 - $190,750
More than $2.5 billion: $165,625 - $209,003

Background: finance, economics, or related fields, with strong analytical and research skills. Often hired from investment banks, asset management firms, or other research-focused roles
Read 20 tweets

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