Curated by: Rubric Advisors
Personal Finance
Family Office Basics
A family office provides comprehensive wealth management for affluent families, coordinating investments, taxes, estate planning, and more.
Family Office Basics
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What Is a Family Office
- A dedicated entity managing the financial affairs of one or a few wealthy families
- Typically handles investments, tax planning, estate planning, insurance, philanthropy, and family governance
- Provides coordination across all advisors and service providers under one umbrella
- Generally considered relevant for families with approximately $25M or more in investable assets
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Full Guide
What Is a Family Office
- A dedicated entity managing the financial affairs of one or a few wealthy families
- Typically handles investments, tax planning, estate planning, insurance, philanthropy, and family governance
- Provides coordination across all advisors and service providers under one umbrella
- Generally considered relevant for families with approximately $25M or more in investable assets
Single vs. Multi-Family Office
- A single family office (SFO) is dedicated exclusively to one family, offering full control and customization
- SFOs typically cost $1M to $3M or more annually to operate due to staffing and overhead
- A multi-family office (MFO) shares resources across several families, reducing cost but also customization
- Hybrid models exist that blend dedicated and shared services to balance cost and personalization
Core Services
- Investment management, asset allocation, and manager selection across all family entities
- Tax planning and compliance coordination across multiple entities, trusts, and jurisdictions
- Estate and trust administration, including coordination with legal counsel
- Risk management, insurance oversight, cash flow management, and philanthropic planning
When to Consider a Family Office
- Financial complexity exceeds what a traditional RIA can coordinate, such as multiple entities and trusts
- The family holds diverse asset types including real estate, private businesses, art, and alternatives
- Multi-generational wealth requires a governance structure to manage decision-making across family members
- Desire for consolidated reporting across all assets, entities, and investment accounts
Cost Considerations
- Single family offices typically require $1M to $3M or more per year in staffing and overhead costs
- Multi-family offices generally charge 0.5% to 1.0% of assets under management
- A virtual family office model coordinates existing advisors with a central quarterback at lower cost
- Compare the total cost to the value of tax savings, improved investment outcomes, and time saved
Governance & Next Generation
- A family mission statement and investment policy can help align family members on goals and values
- Regular family meetings and financial education programs may help prepare heirs for wealth stewardship
- Succession planning for family office leadership helps ensure continuity across generations
- Documenting family values and philanthropic goals can provide a lasting framework for future decisions
Alternatives to a Full Family Office
- A comprehensive wealth management firm or RIA may serve as a lighter-weight alternative
- Outsourced family office services are offered by some banks and trust companies
- A virtual family office model coordinates specialized advisors without a dedicated staff
- Most families below $50M may be well-served by a quality RIA with strong planning capabilities
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