Source: NY Times: Business
Wealth Matters: Your Child’s Tuition Is Paid While You’re in Tahiti

Wealth Matters

By LIZ MOYER

Stuart Ross, a former insurance executive, sold his Puerto Rico-based company 12 years ago and has since enjoyed a globe-trotting lifestyle, with homes in multiple locations and grand travel aspirations.

But while he and his wife, Val, are away on extended holidays, the bills and other burdens of daily life continue to pile up. He turned to his wealth adviser for help managing these tasks and was connected to Total Personal Services, a Garden City, N.Y., company that does things like sorting and scanning his personal mail, paying bills, arranging international money transfers, and routine household services.

Mr. Ross, who calls a ranch in Glenwood Springs, Colo., his home base, said the arrangement helped ease the stress of travel, because he knows that “someone is watching the farm.”

For high net worth families who lead complex financial lives, wealth advisers and accounting firms offer what they call family office administrative services — that is, daily bill-paying and household management tasks, which are distinct from the money management and family coordination services that are more commonly associated with family offices. These personal-assistant-type services can come in handy when the owner of the money is out of contact or away from home for long periods of time.

When Mr. Ross and his wife sailed their yacht Restless on a six-month journey that took them from the Caribbean through the Panama Canal and on to the Galápagos, Tahiti and New Zealand (with several land stops along the way), “It was nice to know someone was looking after our stuff,” he said.

He set up a bank account and gave Total Personal Services the power of attorney to distribute the funds to cover any bills or expenses that came up. Mr. Ross said he did not keep more than $50,000 in the account at a time, so “it’s not like they have access to my whole portfolio.”

Nancy Atkinson, the owner of Total Personal Services, said her father formed the company 24 years ago after he sold his stock proxy solicitation company and found there were not any companies that helped wealthy families keep track of mail and other ordinary life tasks.

Multiple homes, airplanes, yachts and other expenses like tuition for school and summer camp or fees for groundskeepers and other household staff members add complexity. Travelers often need someone at home to hunt down documents that help with tourist visas and other issues. Bills for vacation rentals or emergency expenses also need tending.

“We give them back their quality time by handling all the nitty-gritty so they can go off and enjoy life,” Ms. Atkinson said.

Of course, handing power of attorney over to an outside adviser isn’t always necessary. Bills can be set up to be paid automatically through any ordinary bank or brokerage account, or a family member or other person could be designated to handle those tasks.

But advisers say it can be worthwhile to have a formal arrangement. The annual cost of monitoring and handling an account for personal expenses — and perhaps a limited liability company as well — is about $20,000, Ms. Atkinson said.

Paul Pagnato, a Reston, Va.-based adviser who referred Mr. Ross to the service, counts it toward the concierge-style offerings he has for high net worth clients, including luxury travel booking and special event planning. In the past, such perks might have been available only to people at the highest end of the wealth spectrum, but lately more advisers are offering them to those with slightly less money.

Private wealth advisory firms pick up some of the slack in the normal course of business. If a client has already done some financial planning and has set up a revocable trust with the bank named as trustee, the client already has a convenient tool to direct the bank to pay bills in his or her absence through that account.

“It’s the happy byproduct of estate planning,” said Linda Beerman, the head of the wealth strategies group at CIBC Atlantic Trust, which typically offers such bill-paying and administrative services to families with $25 million or more with the company.

These days, people aren’t completely out of communication even while they are traveling, said Jared Feldman, co-leader of the private client group at the New York City accounting firm Anchin Block & Anchin. They will typically check in periodically, and in the meantime if a pressing issue or emergency comes up, the firm can begin looking into it until the client can be located and briefed on the matter.

“We can get on the phone and vet the situation,” Mr. Feldman said. “My business is having that Rolodex handy.”

Mr. Feldman suggests that wealthy people who travel for long stretches set up plans and procedures to anticipate the expected as well as the unexpected, making sure their advisers have one another’s contact information — and that they know where the important documents, online logins and passwords can be located.

Some of the work can be set up in advance, Mr. Pagnato said. Credit card companies have to be notified about likely charges from merchants overseas, so they will accept the charges rather than decline them. Quarterly tax payments and minimum charitable contributions need to be dispatched.

And then there are the nicer details. Ms. Atkinson, for example, said that she and her team even anticipated that a client would want the awnings up around the pool at their beach home in time for Memorial Day weekend, and will contact the service provider to arrange it.

Monitoring cash flow is also important, Mr. Pagnato said. “The reality is the client doesn’t stay on budget,” he said. “Things are usually 20 percent higher. We’re always adjusting accordingly.”

Just having a service to monitor and sort his mail has made life easier for Mr. Ross as he travels from homes as far from one another as South Carolina and Hawaii. All of his mail gets delivered to the service, which filters out the junk mail and sends him a list of what was received. Wedding invitations, greeting cards and other documents he would like to see are forwarded to him.

His advice for people who want to take the vacation of their dreams but are worried about the daily tasks they leave behind? “I would say there are really good options to deal with it and life is short — take the trip,” Mr. Ross said.

 

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