I thought it was funny that John Paulson, the hedge fund billionaire, suddenly announced that he was turning his operation into a “family office” the day after I called his office because I had a question.
A family office is where someone simply manages his own family’s wealth and doesn’t handle outside money. There are fewer regulations on family offices, as there should be.
You probably also have a family office. It’s when you and your spouse meet at the kitchen table to discuss whether to pay the phone or the cable bill this month.
The funny part is that I wasn’t calling Paulson about the conversion he was about to make. I was calling to ask if he was planning to move his hedge fund — or family office, whichever — to Puerto Rico, where the taxes on such operations are only 4% compared with more than 40% in New York City, where Paulson’s company now resides.
As I wrote last week, Puerto Rico in March invited 150 family offices on an all-expense-paid junket to San Juan to explain the merits of such a move.
I’m still waiting to hear if anyone is taking the island up on its offer.
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