Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Wednesday, October 23, 2019

Article on The Virtual Family Office and Personal Financial Planning

FinancialplanningSusan M. Tillery recently published an Article entitled, The Virtual Family Office and Personal Financial Planning, Wealth Strategies Journal, September 3, 2019.

Many consumers, as well as professional advisers, continue to think of personal financial planning as a tool to gather assets under management (AUM) or to sell products; however, CPA personal financial planners have developed a fee-for service model which offers integrated personal financial planning without AUM or product sales. This model embodies the essence of true independence and objectivity, as well as the sought-after fiduciary model; thereby, making it most appealing to the client.

The fee-for service model illuminates the CPAs role as the most trusted adviser. This model also serves as a clear pathway for the establishment of a Virtual Family Office (VFO) for business-owners. This article discusses the fee-for service model, how it opens the door for a firm to offer VFO services and how both service offerings utilize professional collaboration.

The term virtual family office has been loosely used over the past 10 years. On one end of the continuum you have a formal investment management structure enabling the entity to take a deduction for investment fees; this is the subject of the recent Lender case (Lender Management LLC, T.C. Memo. 2017-246). On the other end of the continuum you have a more traditional structure providing tax efficiencies, asset protection and the coordination of professional services to high-net worth (HNW) and ultra-high net worth (UHNW) families. This article addresses the latter structure and focuses on the CPA financial planner providing integrated personal financial planning services within the virtual family office structure. The key aspect of this model is collaboration.


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