What is a Virtual Family Office?

What is a Virtual Family Office?

What exactly is a Virtual Family Office (VFO)? In this video, I’ll explain it briefly. My name is Anthony Anderson, founder of Elite Resource Team.

The Concept of a Virtual Family Office

A Virtual Family Office is more of a concept than a legal entity. It refers to multiple professionals who come together with an open line of communication, working proactively and holistically to serve clients. The term virtual indicates that these professionals aren’t necessarily under one roof or working for the same company—it’s a team-based mindset approach.

The Spectrum of Professional Collaboration

There are two extremes people are familiar with:

1. The outdated referral model, where professionals trade names and phone numbers.
2. The single-family office, where a very high-net-worth family (typically $250 million or more) employs a team of professionals working exclusively for them.

The Virtual Family Office sits in the middle and typically serves mass affluent to affluent clients with a net worth between $1 million and $100 million. Once a client reaches $100 million or more, they might transition to a multi-family office structure.

Key Professionals in a Virtual Family Office

In a Virtual Family Office, you’ll typically see the following professionals working together:

• Financial Advisors: Wealth managers or insurance agents
• Tax Professionals: CPAs or enrolled agents
• Legal Specialists: Estate planning attorneys, business attorneys, or tax attorneys
• Other Specialists: Experts with unique niches, brought in for specific client needs

The Five Disciplines of a Virtual Family Office

At Elite Resource Team, we structure our Virtual Family Office across five disciplines. Here’s a breakdown:

1. Tax Planning
   Includes compliance work (tax preparation) and proactive planning to mitigate income tax, estate tax, and capital gains tax.

2. Legal Services
   Encompasses trust planning, wills, buy-sell agreements, and entity selection.

3. Wealth Management
   Includes managing investment accounts, 529 plans, retirement accounts, and more.

4. Risk Mitigation
   Includes life insurance, property and casualty insurance, key employee retention strategies, and captive insurance companies.

5. Business Advisory Services
   Helps business owners with employee culture, key employee retention, measuring key performance indicators (KPIs), leadership coaching, and business succession planning (e.g., mergers, going public, selling to third parties).

Conclusion

If you found this video helpful, give it a thumbs up and consider subscribing for more content like this. We release 2-3 videos every month. And if you’re a financial advisor or tax professional looking to incorporate a Virtual Family Office approach into your business, schedule a complimentary strategy session with us. The link is in the description below.