After “do we need a family office?” the next question is almost always “what will it cost?” The short answer is around a million dollars a year for a lean office and several million for a large one. The useful answer is a percentage, because the same budget means very different things at $100 million and at $2 billion.
First, know what is being counted
Family offices have two kinds of cost, and reports do not always count them the same way.
- Operating costs. Staff, office space, IT, legal and compliance work, accounting, and reporting. UBS calls these “pure” costs.
- Investment fees. What the family pays to fund managers, banks, and outside advisers to invest the money.
UBS reports the two separately. The RBC and Campden Wealth survey of North American offices leaves investment fees out. Citi says the figures in its survey mostly reflect internal costs and estimates the total, including outside advisory fees, at typically 1% to 2% of assets a year. Before comparing any two numbers, ask which of these they include.
A quick note on basis points
Costs are often given in basis points. One basis point is one hundredth of one percent (0.01%). So 50 basis points is 0.5%, and on $100 million that is $500,000 a year.
What the surveys say
- UBS, 2025 report (317 family offices, average assets about $1.1 billion): average operating cost of 41.1 basis points in 2024. Offices with more than $1 billion averaged 35.1 basis points.
- J.P. Morgan, 2026 report (333 family offices): average yearly cost of about $3 million. Offices managing $250 million or less spent about $0.9 million; offices above $1 billion spent about $6.6 million.
- RBC and Campden Wealth, 2025 report: North American offices spent an average of $4.3 million a year, not counting investment fees. Offices under $250 million averaged $1.1 million, or 62 basis points. Offices over $1 billion averaged $9.8 million, or 35 basis points. In the 2026 edition, offices expected costs to rise by about 5%.
- Citi, 2025 report (346 respondents in 45 countries): 36% of offices run at under 50 basis points and another 36% at 50 to 100 basis points.
Two things stand out. Larger offices spend more dollars but a smaller percentage of assets. And the surveys do not line up exactly, because each one asks different offices different questions.
Where the money goes
People are the largest line. In the UBS 2025 report, staff made up about 67% of operating costs, followed by legal and compliance (10%), office space (8%), IT (7%), and research (5%). Operating costs themselves were a little over half of total spending; the rest went to asset managers, banks, and external structures.
Pay for senior roles is substantial. In the RBC and Campden 2025 report, average total pay for a family office chief executive ranged from about $286,000 at small offices to about $1.14 million at the largest. The 2026 edition put median pay at $460,000 for a family-member CEO and $721,000 for a non-family CEO. A Heidrick & Struggles survey of 106 family offices in the U.S. and Europe found that U.S. chief investment officers earned an average base salary of about $864,000 in 2025, before bonus, though that figure rests on a small sample.
Many offices are small. UBS found an average of 12 employees; Citi found that 63% of offices have six or fewer.
A good share is outsourced. J.P. Morgan found that about a quarter of costs go to outside providers. More than half of offices outsource legal work, and over a third outsource cybersecurity.
Technology is often underfunded. RBC and Campden’s 2026 report put median IT spending at about $100,000 a year and called it under-investment. We come back to this risk in Part 5.
When does it pay for itself?
The arithmetic is simple. Divide the yearly budget by the assets.
- A lean office costing about $1.1 million a year (the RBC small-office average) is about 1.1% of $100 million, but only 0.11% of $1 billion.
- BNY gives a similar example: a $6.5 million budget is about 260 basis points on $250 million and about 65 basis points on $1 billion.
Now compare the cost with the return. If a portfolio earns 6% a year, a 1% cost takes one sixth of it. Over time the gap compounds: money growing at 5% a year instead of 6% ends up about 25% smaller after 30 years. That is why the threshold for a single family office keeps moving up, and why Part 2 found estimates from $100 million to $1 billion.
The alternative: a multi family office
A multi family office spreads the same costs across many clients. Fees vary widely. The Family Wealth Alliance found an average minimum annual fee of about $100,000 in 2024, up from $65,000 in 2015, and 70% of the firms it studied also charged a retainer on top of an asset-based fee. One Canadian study put the average asset-based fee at about 0.5% a year, while some firms quote ranges up to 2% for smaller or more complex relationships. Compare the all-in cost, not just the headline percentage.
A fair caveat
These surveys rely on what offices choose to report, and their samples are a few hundred offices, mostly large ones. Averages are pulled up by the biggest offices. Costs also differ by country, by how much is done in-house, and by how complicated the family is: three generations in four countries cost more to serve than one couple in one city. Use the numbers to frame a conversation, not as a quote.
Five lessons to take away
- Ask what is included. Operating costs and investment fees are different numbers. A low figure may leave out the larger one.
- Think in percentages. A $2 million budget is modest at $1 billion and heavy at $100 million.
- Budget for people first. Staff are about two-thirds of operating costs.
- Small differences compound. One percentage point a year can mean a quarter less wealth after 30 years.
- Do not save on security. Cheap IT is a false economy for an office that holds a family’s most sensitive data.
Questions to bring to your advisors
What would our office cost each year, in dollars and as a share of assets? Which costs are included in that number, and which are not? What would a multi family office charge for the same work, including minimum fees? These are questions to bring to your advisors, not advice.