The family office question surfaces around the same inflection points: a liquidity event, a generational transfer, a portfolio that has grown beyond what a traditional advisory relationship can manage. The instinct to formalize — to hire staff, build infrastructure, and operate independently — is understandable. It is also frequently premature.
What a Family Office Actually Costs
A single-family office requires, at minimum, a chief investment officer, a CFO or controller, legal and compliance infrastructure, and an operations layer to handle reporting, custody, and vendor management. Average annual operating costs scale sharply with assets under management: family offices with less than $250 million in AUM spend roughly $900,000 a year on average, rising to $1.7 million for offices between $250 million and $500 million, and $6.6 million for those above $1 billion — up from $6.1 million the year before1.
That math has an implication: at $50 million in assets, the $900,000 average consumes roughly 1.8% of the portfolio before a single investment is made. At $100 million, it's closer to 0.9%. Costs fall further in percentage terms above the $250 million mark, where the $1.7 million average represents well under 1% of assets at the top of that tier1. Below roughly $250 million, families are typically paying for a capability they could access more efficiently elsewhere.
What the Threshold Is Really Measuring
The question isn't just assets under management — it's what you need the structure to do. Families considering a family office are usually trying to solve for one or more of the following: consolidated reporting across complex holdings, access to institutional-grade investments, coordination across tax, legal, and estate planning, and governance infrastructure for a multi-generational wealth transfer.
A private wealth relationship with genuine institutional access solves most of those problems at a fraction of the overhead. The ones it does not solve are narrow: families with operating businesses requiring active management, complex multi-jurisdictional structures that need dedicated legal staff on retainer, or governance needs that require a formal board and investment committee with independent fiduciary accountability.
That last category represents a small fraction of families who inquire about the SFO model. Most are better served by a private wealth relationship that can deliver the same investment access and reporting transparency without the staffing cost and operational complexity.
Where Manhattan West Sits in That Framework
Manhattan West operates as a registered investment adviser serving UHNW families and family offices across 36 U.S. states and 28 countries. For families below the SFO threshold, we provide access to leading private companies across artificial intelligence, aerospace and defense technology, and data infrastructure — access that most independent family offices spend years building relationships to obtain. That access comes integrated with goals-based wealth management, estate and tax coordination, and consolidated reporting through MW Wealth IQ.
For existing family offices, we serve a different function: co-investment access and deal flow for offices that have the governance infrastructure but lack the private company relationships to execute at the cap table level.
The decision to build a single-family office should be driven by the specific capabilities a family cannot source externally — not by asset size alone. For most families under $250 million, those capabilities are available, at institutional quality, without the overhead. The question worth asking before committing to the SFO model: what specifically will we do internally that we cannot get from a well-resourced private wealth relationship? If the answer is unclear, the timing is probably wrong.
Families working through this decision are welcome to speak with our team directly. The analysis takes less time than the overhead it might prevent.
