Anthony Layton MBA, CIM

Chairman & CEO, Portfolio Manager

Peter Guay MBA, CFA

Portfolio Manager
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  • Montreal, Quebec H3Z 3B8

What is a multi-family office | PWL Capital

What is a multi-family office?

Your family has many needs across multiple generations. These include investment management, tax and estate planning, charitable giving and much, much more.

As your family becomes wealthier, you probably won’t have the time, expertise or desire to manage it all yourself.
That’s why many families choose to have a dedicated team of professionals manage their wealth in an integrated way.

The richest families set up an office whose sole focus is managing the family’s affairs. The Rockefellers were the first family to set up an office to handle their family’s affairs way back in the 1800s. In recent years, more and more wealthy families have set up offices.

But running a single-family office costs millions of dollars a year and that puts it out of the reach of all but the super-rich. However, there is an alternative known as a multi-family office.

What is a multi-family office? It’s a team of professionals that looks after the affairs of several families.

Families share the costs

This allows the families to share the costs of running the office. And that makes a big difference in how much they have to pay for the services they receive.

Multi-family offices come in many shapes and sizes. But they all should offer complete confidentiality and highly personalized service.

They should also provide you with integrated wealth management. This means the team takes a holistic approach to your family’s affairs. From financial planning to investment management to tax optimization, estate planning, insurance needs and coordination of charitable giving—each part is aligned with the others.
Your team should also coordinate the work of specialized experts such as accountants and lawyers. It should make sure all the administration is taken care of and you’re kept fully informed and consulted as your family’s situation evolves.

This kind of an integrated approach offers many benefits. They include:

  • the convenience of having a one-stop shop where all of your financial affairs are managed under one roof
  • personalized service based on a deep knowledge of your family
  • access to a network of expert advisors
  • reduced costs thanks to resource sharing and economies of scale

Things to watch out for

If you think a multi-family office might be right for your family, there are a few things you should watch out for as you search for a firm.

First and foremost are the fees. You want to make sure you’re paying a reasonable amount of money for the services you receive.

One thing to be careful about is the investment products you are being sold.

Funds and insurance products can have sales commissions and management fees imbedded in them. And there can be other kinds of fees, such as those charged for so-called wrap accounts.

Often, these various fees will be in addition to an overall charge for managing your family’s financial affairs. It can all add up to a heck of a lot of money and eat up all your investment returns. So, buyer beware.

You will also want to make sure the firms you are considering have the experience, resources and expertise to provide the kind of fully integrated wealth management that I talked about.

Your participation is important

Finally, your family will play a critical role in making your family office a success.

You should communicate constantly amongst yourselves to avoid conflicts and ensure a common vision. Then, you can work closely with your team to find an approach that’s right for your family.  

The result will be financial security and peace of mind for many years to come.


By: Anthony Layton | 0 comments

Donations Part 1: Cash

Welcome back to “Do It Together” financial planning. This is the first in a three-part series on donations, focusing at the tax advantages of making donations, specifically cash.

Canadians are very giving, according Statistics Canada, 84% of us give to charity and together we give an average of $9 billion dollars a year. That’s pretty amazing.

In this video, I talk about how to choose a charity that’s right for you, how to vet them to make sure they’re legitimate, the kind of tax credits you’ll receive when you make a donation and I’ll take you through the federal government’s First-Time Donor’s Super Credit. There’s a lot of good information in this video so check it out and subscribe to my YouTube channel to learn more.


By: Peter Guay | 0 comments

The pros and cons of setting up a family foundation

Many Canadians who have done well in life want to share their good fortune. They choose to do this in different ways—by volunteering their time, speaking out in support of a cause and by donating to their favourite charities.

In the case of donations, some wealthier families choose to create a private foundation to organize and focus their charitable activities. In fact, there are over five thousand private foundations in Canada and the number is growing.

But remember: This is a decision that involves a lot more than just money. Running a private foundation requires a commitment of time and energy.

First, let’s look at what a private foundation is.

A private foundation is a corporation or a trust that is a registered charity.  It is controlled by a single donor or a family through a board where a majority of directors are not at arm’s length. This is why these foundations are often referred to as family foundations.

Private foundations are tax exempt and can issue official donation tax receipts. While a foundation must operate exclusively for charitable purposes, it can use its funds to operate its own charitable programs or make donations to other registered charities.

The advantages of setting up a private foundation

Now, why would you want to set up a private foundation? What are the advantages?

As I mentioned earlier, a foundation allows you to focus your giving on a cause you are passionate about. In doing so, the foundation can also take donations from non-family members and conduct fund-raising activities.
 Family members such as your spouse and children can get involved as donors, trustees or directors and even as employees of the foundation.

Another thing that people like about a foundation is they are directly involved in how their money is invested and disbursed. Control over the foundation provides flexibility in the event your charitable objectives change, or new needs arise to which you would like to respond.

A foundation gives you the possibility of creating a lasting legacy, one that will continue supporting a cherished cause after your death. It can be named for you or your family, or you can use a completely unrelated name for it.
And, of course, there are the tax savings. Thanks to charitable donation tax credits, for every dollar you give to a registered charity, you get back around 50 cents—depending on your province of residence and marginal tax rate.

You can claim tax credits on donations up to 75% of your net income in the year the donation is made. And unused portions of your donations can be carried forward for up to five years.

You have the flexibility to make donations to a private foundation at times that best suit your tax and estate-planning objectives. In addition, you can make donations and enjoy the tax benefits without having to immediately select the charity or the program to receive that gift.

The disadvantages

So those are the pros. Now let’s talk about the cons.

One of the biggest disadvantages is the costs involved. First, it costs money to set up a foundation, notably for legal and accounting fees.

Then, there are the ongoing expenses for such things as tax filings, preparation of audited financial statements, issuing of tax receipts and investment management.

Beyond this, there are other administrative headaches involved in ongoing compliance and the day-to-day operations of the foundation.

You also have to be ready to accept a certain lack of privacy. That’s because the Canadian Revenue Agency discloses to the public information about your foundation, including its annual financial statements.
Finally, your children and other family members may not share your passion for the cause you support. They may not want to participate in governance or the administration of your foundation. And they may not want to carry it on after your death.

Look before you leap

Setting up a private foundation is an important decision in the life of your family. You should make sure to look at it from every angle with experienced advisors and be ready to make substantial donations to justify the costs and headaches.

You should also look at the alternatives. One very popular one is a donor-advised fund with a public foundation, such as a community foundation. These funds allow you to enjoy many of the benefits of a private foundation and avoid many of the downsides.

I commend you for wanting to share your good fortune. Just make sure you do it in a way that allows you to maximize your giving and minimize unwanted expense and stress for you and your family.

By: Anthony Layton | 0 comments