The value of advice- When the stars aligned for the Bank of Mum and Dad

Steve Thaxter- Senior Partner and Principal Adviser

Sovereign Wealth Partner



There was cause for quiet celebration in one of our clients’ household a few weeks back.  A private investment they’d made had paid off handsomely.  The investment itself we take no credit for – it was solely the client who had committed to the risk and put in the hard yards.


But at Sovereign we were celebrating too, because in collaboration with the client and their accountant, the decision had been made at the outset to hold the investment in a family trust.


This allowed the stars to align in multiple ways:


Whilst a family trust is not suited to all investors, it can be the ideal vehicle for certain family investment projects and be the day-to-day work-horse of “The Bank of Mum and Dad”.


Other common ownership structures The Bank of Mum and Dad might also use include self-managed superannuation funds (SMSFs), investment companies, joint investments and partnerships.  Each comes with pros, cons and varying annual running costs.


So if you’re aiming for the perfect ten with your wealth set up, look carefully at how you’ve structured your investments, especially before embarking upon a new venture.  Talk to us, it may only need a quick discussion but the potential to improve the outcome in the years ahead might be quite profound.


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