What Is a Reasonable Family Office Budget as a Percentage of Assets?

A reasonable family office budget depends on the work the family expects, its assets, and its operating model. One family office executive we interviewed for The Single Family Office said a small, lean office could budget up to 1% of net assets each year. The executive also said to compare performance with alternatives and consider non-financial benefits. Treat that as one perspective, not a universal rule.

Set the Budget From the Work

Start by deciding what the office is expected to handle. Consider whether you need internal investment staff, accounting and reporting, coordination with outside providers, family administration, or support for complex assets. Then estimate the people and systems needed, along with outside services. A budget tied to a defined scope is more useful than a percentage chosen in isolation.

The family also needs to decide how much control and transparency it wants, whether family members will hold core roles, and what annual operating budget is acceptable. These choices affect both cost and responsibility. A lean office that outsources specialist work will have a different cost profile from a team built to manage more activity internally.

Compare With Alternatives

Evaluate the budget against other ways of meeting the same needs. A private bank, multi-family office, or virtual arrangement may carry different fees and offer a different level of control and service. Compare the complete scope, including outside costs and the time family members must contribute. Consider whether the office improves coordination, communication, or oversight in ways that matter to your family.

Measure performance against alternatives and consider investment returns. A family may value better reporting, continuity, or support for family communication. Define those benefits clearly so the budget can be reviewed against the work delivered.

Review the Plan as Needs Change

Break the budget into clear categories. These might include staffing and technology, along with administration and external professional services. Identify which costs are fixed and which vary with activity. Review whether each expense supports an agreed responsibility, and revisit the plan when the family's needs or operating model changes.

Use the family office cost calculator to organize cost assumptions, then compare the resulting plan with annual single-family office costs. You can also consider overhead controls and the virtual family office model. If your plan touches legal or tax structures, talk with your attorney or CPA before settling those details.

I would be prepared to invest up to 1% of net assets per annum on setting up and growing a small family office

Sources: How to Start a Family Office, The Single Family Office. Informational only, not financial, legal or tax advice.