Is setting up a family office worth it compared to availing a robo-adviser service for my wealth of $20 million?

Family Office

Usually, the economics of setting up and running a family office is more viable if the size of the investible assets is at least $100 million. At the very least, you would need to have one full-time investment expert, subscription to a bunch of proprietary data repositories, good amount of traveling at least for one investment expert, legal advice on need-basis, tax advice on need-basis, and these costs add up to a tidy amount!

If the size of your investible assets is above $15 million, you can consider to pool your assets with that of other wealthy people to set up a family office. It is very important to make sure that all the members of the multi-family office agree on the investment style and the nature of expenses incurred. This is easier said than done! This method is prone to occasional disagreements between the members of the multi-family office.

So, as you mentioned that the size of your investible wealth is in the $10 million to $20 million range, you have the following options:

  • If your life situation pertaining to finances is complex, or your investment expectation is subjective, then you can opt for a high-quality financial adviser or a private wealth manager for those needs. The rest of your wealth can be invested through a good robo-advice solution.
  • Else, if you can invest all your investible assets in a highly-diversified portfolio for the long term, then you can opt for a good robo-advice solution for all of your investible assets.

Our firm QuietGrowth has clients across the broad spectrum of individual financial strength.

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