When Your Life Changes, So Should Your Portfolio

I often get asked why people choose to join family offices over traditional brokerages like Morgan Stanley and Merrill Lynch as an investment partner. Most recently, an acquaintance of mine that had just sold her business asked me this question with a twist – “Why should I entrust my money with a firm like yours (Laird Norton Wealth Management) rather than investing the assets as I always have; in a mix of cash, bonds, ETFs and Mutual Funds?”

Twist or no twist, my response to this question is always the same. I explained to her that family offices usually take a holistic approach which includes the investor – not simply her assets. They do this because they want to help their clients understand that it’s not just about wealth or investing your money. In many cases, it’s about how your needs and those of your family may change in response to newly found wealth. More often than not, money changes a family’s dynamics. Should you put it into a trust? Should you invest it in another venture? Should you give some of it away? Should you use it to fulfill your lifelong dream of hot air ballooning around the world in 80 days? It’s actually very hard to make these big decisions on your own. After all, you usually aren’t the only one affected by them. Your children, grandchildren and community will all be affected. The perspectives of those who have experience addressing these questions can prove invaluable as you deal with this transition.

A good family office will help you realize that this money has the potential to go over to multiple generations and that it needs to be protected so that it can last. Not only does this suggest a longer investment horizon, it also has implications in how you structure the money. You will need to shield it from taxable events, decide when and how you will give it to your children and define the kind of a legacy you want to leave behind.

I believe that Laird Norton Wealth Management is unique relative to its peers in that its founders (the Laird and Norton families) are on their seventh generation of wealth. Even more, each of those seven generations has added to the wealth pool over the years. Through this experience, they gained many insights regarding the effective management of money over several generations. Put simply, they know what works and what doesn’t.  My firm really leverages this to help its clients make the decisions that come with major transitions good ones for both yourself and the people you care about most.