An individual, family, group, or entity that contracts for and receives services from a professional services firm, advisory firm, individual advisor/consultant, family office, or other service provider.
Defining who the client is and other attributes of the client-advisor relationship are important both legally and in service delivery. In financial and other types of services, the client is first and foremost defined by the contract securing the services, including who signed the retaining agreement and who is defined as the legal client under regulatory provisions. Operationally, however, a firm may serve more members of a family than just the person(s) who originally signed the client agreement. The primary benefit is that the firm perceives the family as the real client and targets services accordingly. Risks include creating conflicts and ambiguities as to who is (and who is not) a client, particularly in situations where information about or for a family member is discussed with other family members or advisors. Expanding who is able to receive services without correspondingly adjusting the client agreement or the fees charged can also lead to difficulties for the firm providing services.
In wealth management or family office services, initially the “primary client” is often the wealth creator. As wealth and the family grow over time, advisors frequently expand their services to address the needs of spouses, partners, siblings, in-laws, children, grandchildren, etc.
See Also: Family
Curtis, Gregory. Family Capital: Working With Wealthy Families to Manage Their Money Across Generation. Wiley:2016.
SEC. “Form ADV.” Accessed 9/13/24. https://www.sec.gov/files/formadv-instructions.pdf
