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What are Family Investment Offices & What Do They Invest In?

By Finserv MARKETS - Jul 31,2019
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ULIP plans for Wealth management

Family investment offices are essentially wealth management services firms which cater to high net (worth) individuals (HNIs) and their families. They offer a bouquet of services across departments, all of which are aimed at helping the HNI families manage their wealth through complete financial advice and solutions. The advice is not restricted to but mainly includes legal, insurance, investment, estate, business, tax, lifestyle and can even cover philanthropy-related advice. They present a range of options, including helping clients assess the best ULIP performance before they invest.

Family offices may serve just one specific ultra-affluent family, in which case they are called a single family office; or they may offer their services to several families in a manner reminiscent of traditional wealth management firms. Several family offices also handle household arrangements such as arranging for the private education of children in the family, travel itineraries as well as provide other miscellaneous services.

What are all the things that a family office does?

For one professional adviser to look after the interests of even one ultra-wealthy family and arrange for a comprehensive wealth management plan would be a Herculean task. As a result, most family offices employ a team of experienced professionals from disciplines such as tax, insurance, investment, legal and estate in order to provide the full bouquet of services which may combine financial planning, asset management, risk management, cash management and lifestyle management as well as a host of other services to cater to the requirements of ultra-wealthy individuals and families.

Wealth management involves investing across funds, and family offices tend to invest on a long-term basis. The Bajaj Allianz ULIP plans, available on Finserv MARKETS, would prove an invaluable tool for many such family offices since one can invest across funds including debt, equity or a combination of both. ULIP plans enable one to secure their family’s future through a life cover, and they also give one an opportunity to invest in the market.

Family offices in India are also beginning to invest in startups across the seed and growth stages. For instance, Aarin Capital, which was started by HNIs Dr. Ranjan Pai and Mohandas Pai, invested in the startup INC42. Artha India Ventures is a venture fund backed by the family office K Damani Group, and led by Anirudh Damani. AIV recently invested in startups OYO Rooms and Coutloot, both of which have seen great success since then. Even as family offices diversify from their regular bouquet of investment tools in a bid to achieve higher returns, the best ULIP plan also offers opportunities to invest across funds. The top performing ULIP funds, such as those available on Finserv MARKETS, are led by advisors who have learnt to thoroughly read the market and are able to understand market forces and thereby decide on the correct diversification of funds and investment plans.

Family offices also invest a large part of the wealth in real estate projects and in private equity, since these are both long-term investments which can reap high rewards. Two other important functions that a family office performs are providing services aimed towards legacy planning and lifestyle management.

Read on below to learn more about these two aspects of a family office’s role:

1. What is Legacy Planning and Management?

Legacy planning refers to implementing a comprehensive wealth transfer plan, wherein family education plays an important part. All members of the family are educated with regard to the wealth held by the family and other financial matters, while family values are also instilled which help prevent inter-generational conflicts in the long run. Family offices, as well as family members, work together with professionals across disciplines for proper coordination and implementation of the wealth transfer plan, to ensure the family’s wealth transfer plan is well-coordinated and optimised for its legacy’s desires.

A plan of this depth must include provisions for all aspects of the family’s wealth including transfer or management of business interests, estate’s disposition and management, management of family trusts, ensure continuity of family governance as well as make arrangements to execute philanthropic desires expressed by the family. Such extensive planning is required because of the obstacles faced by high net worth families with regards to complex estate taxes or laws, and complicated family or business issues.

The Bajaj Allianz Long Life Goal ULIP is a great option for those looking for legacy planning solutions, since it assures a regular income long after retirement, even at the age of 100 years. You can pay as little as Rs. 5,000 a month as premium and be assured of not just an income for your retired life, but also leave behind a tidy sum for your survivors. It is one of the top performing ULIP funds in the country, which allows you to partially withdraw sums as and when you require them, without charging you for them. Best ULIP performance is noted in funds with the ability to pass on the plan in case of death of the original policyholder.

2. What is Lifestyle Management?

Many family offices also cater to the personal needs of an affluent family and provide services like establishing credentials before hiring staff for personal or business requirements, providing personal security while at home and during travel, streamlining business processes, aircraft, and yacht management, and even help plan for travel and accommodation.

Family offices today are extending the scope of their funding activities by extending investments to startups or even through ULIPs. Bajaj Allianz ULIP, available on Finserv MARKETS, is proving to be a promising investment vehicle with multiple funds aimed at different purposes. While some are child plans aimed at creating a pool of wealth for your children and their educational needs, others help generate wealth for retirement and old-age needs. Top performing ULIP funds in the country allow you to change your investment strategy in line with your changing personal life goals. Head over to Finserv MARKETS right now to check what’s on offer, with the best ULIP plans in the market.

“Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere!”

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Bajaj Finserv Direct Limited ("BFDL"), erstwhile Bajaj Financial Holdings Limited is a registered corporate agent of Bajaj Allianz Life Insurance Company Limited and Bajaj Allianz General Insurance Company Limited under the IRDAI composite registration number CA0551 valid till 10-Apr-2021. BFDL also renders services to Bajaj Finance Limited (‘BFL’) and Bajaj Housing Finance Limited (‘BHFL’) (referred hereinafter as ‘Lending Partner’) in sourcing of customers, providing preliminary credit support activities, fulfilment services and post-acquisition customer services related to lending business. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522