What Is the Role of a Family Office

Are you interested in investing? Maybe you have extra money that you want to increase in value and build a portfolio of diversified assets for your eventual retirement. While most people take some of their hard-earned after-tax dollars and put it in investments that will give them a good return over time, some high-net-worth individuals and families need a more hands-on approach to managing their wealth.

Those of financial affluence must have a dedicated team to manage their assets to preserve and grow their wealth so it is generational. They will benefit most from a family office.

Family office? Is that a room in your home where your computer and printer live? No. It is a wealth management firm that gives personal financial services to those who have millions of dollars in assets. This is the role of a family office.

Types of Family Offices

There are different levels of service and requirements for affluent clients, and a family office firm can cater to their needs accordingly.

Type #1: Single Family Office

This is a firm that is dedicated to only one client. They handle the multifaceted needs of ultra-high-net-worth families who have 100s of millions to manage.

Type #2: Multifamily Office

Financial firms that manage dynamic wealth often expand to be able to handle more than one client. They may have larger teams to care for those families with 10s to 100s of millions in investable assets.

Type #3: Virtual Family Office

In this digital era, location around the globe is not a barrier to effectively managing clients’ wealth, even when spread across geographies.

This expert personal service is typically charged based on a percentage of the investment assets under management for a multi-family office. For the single office, it may take over 1 million dollars per year to operate, and some use outside firms or are employed directly by the family.

Family Office Services

A family office is not just about investing money for their clients. They provide many personalized services, including investment management and caring for their wealth. This includes:

  • Financial planning
  • Philanthropic investing
  • Tax planning
  • Estate planning
  • Legal compliance
  • Risk management
  • Trusts
  • Property management
  • Family governance
  • Succession planning
  • Lifestyle management

Beyond this are day-to-day responsibilities with payroll and accounting, travel booking, concierge services and staff management.

Family Office Team

This type of wealth management is very broad and requires a team of experts in various disciplines to be effective. The team members required will be:

Financial Advisors

These are investment and wealth managers that look after the family fortune and invest their client’s money in a diversified way to maximize profit. There may also be a team of financial experts to effectively control the money and monitor it according to their client’s wishes.


Because of the various interests the family may have, a lawyer needs to be part of the team to give legal advice. They must have comprehensive knowledge of trusts, real estate law and criminal matters.

Tax Specialists

This includes accountants and lawyers with a taxation specialty. Their work is complex as high net-worth people will have many assets, investments, businesses and employees to consider. A tax specialist will work within each business entity and the broader portfolio to minimize taxes and often save their clients 10s millions of dollars.

Estate Management

For those with 100s of millions to billions of dollars, they are not going to spend their money within their lifetime. Theirs is generational wealth, and it must be managed as such to provide for the family members that follow. This multi-generational need requires effective estate management about the following:

  • Family trusts
  • Estate taxes
  • Liquid asset transfers
  • Family management

The estate will include businesses, investments, and cash that all must be intelligently transferred according to the heir’s wishes, and the firm will need to take on the role of educator for the next generation for them to secure existing wealth.

Family Office Benefits

If you are among the financial elite, consider using a professional family office to effectively manage your assets. Your family has worked hard to attain this level of wealth, and a dynamic family office will help you manage your current assets and assist in its growth.

Dedicated Team

Having a dedicated team to manage a family’s wealth is crucial because they are always analyzing and tracking the portfolio of investments. Because they are full-time on one family, they understand their personal and professional needs, investment goals and risk tolerance. They also maintain high confidentiality and privacy for their clients.

Cost-Effective Structure

It can be costly to hire outside professionals to get advisory services, but a family office has an entire team under one roof. This saves the family time and money because of the in-house talent already in place.