What is a family office?

For ultra-high-net-worth families and individuals, a family office provides comprehensive wealth management to help manage, preserve, and support the growth of capital across generations. On this page, we’ll go into more detail about the meaning of a family office and outline the key advantages and disadvantages to consider.

The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.

A family office is a private wealth management firm that oversees the investments, legal, tax, and personal affairs of a high-net-worth individual or family. Often designed to operate across multiple generations, family office wealth management can provide a comprehensive suite of services, including:

• Financial management
• Tax, business, and estate planning
• Philanthropic strategy
• Succession planning

By centralising these services, a family office can help families or individuals preserve, grow, and transfer their wealth, while maintaining privacy and control. Family offices can also help clients comply with relevant tax laws, reporting standards, and regulatory obligations.

You might hear different names for family offices, and that’s because there are typically three main types in Ireland:

• Single-family offices (SFOs): Dedicated to only one individual or family, offering personalised, in-house management.
• Multi-family offices (MFOs): Serves several individuals or families, sharing resources and costs while still providing tailored financial services.
• Virtual family offices (VFO): Operates digitally, using external advisers and technology to deliver the same service but with lower overheads.

A virtual family office (VFO) offers the same breadth of expertise as a traditional family office, but operates in a leaner, technology-driven setup. Instead of hiring an entire in-house team, a virtual family office may partner with external advisers and digital platforms to efficiently manage its clients’ wealth.

This virtual setup may appeal to those who want the comprehensive guidance of a family office, without the operating costs of hiring a large team.

Family offices focus on creating a central hub for wealth and governance, ensuring coordinated decision-making across all areas of a client’s financial and personal life.

Unlike traditional financial advisers, who typically focus only on managing investments or offering specific financial products, family offices provide comprehensive financial, investment, and lifestyle management services under one roof.

As a concept, you could think of a family office as a central point for financial coordination and decision-making for high-net-worth clients.

The primary role of a family office is to manage and oversee investments on behalf of their client  — which may include equities, bonds, real estate, private equity, and other alternative assets.

In addition to long-term investments, a family office may also oversee short-term savings products to ensure liquidity. This can include depositing funds in competitive savings accounts, helping the client earn returns while keeping cash available for planned or unplanned expenses.

A family office might not be the right fit for everyone. It’s designed for those who require specialist management of their financial and legal affairs, and may be relevant in the following situations:

• Clients with significant wealth (typically around €100 million* or more in assets). Given the high cost of running a family office, it may be more practical at this level of wealth.
• Clients with complex financial affairs, such as multiple properties, trusts, or international investments.
• Clients with a focus on legacy and succession planning, including estate management and education of future generations. A family office can also assist with complex issues such as inheritance tax planning and dividing an inheritance, helping families transfer wealth efficiently while minimising disputes.
• Clients seeking privacy and governance, ensuring control, data protection, and alignment with long-term values.

While a family office can offer a number of benefits to clients, it can also come with significant challenges and costs.

Here’s an overview of the potential advantages and disadvantages:

Even for clients working with a family office in Ireland, comparing savings options can be useful to maintain liquid assets while still growing your funds.

Raisin offers competitive rates on fixed term deposits, and deposits of up to €100,000 per person and bank are legally protected by the national deposit guarantee scheme of the country where the bank is headquartered. Getting started is easy: simply sign up for your free Raisin Account, apply to open your preferred savings option, and deposit your funds.

*https://masttro.com/insights/family-office-minimum-net-worth