Family offices provide unmatched privacy and governance, but they come with a high price tag. Understanding the costs of running a family office in 2025 helps families plan budgets and evaluate whether an SFO or MFO is the right fit.

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Typical Cost Structures

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Expenses usually fall into these categories:

• Staff Salaries: Investment officers, CFOs, lawyers, tax experts.
  
  
• Compliance and Risk Management: Regulatory requirements and audits.
  
  
• Technology: Reporting platforms, cybersecurity, data storage.
  
  
• Operations: Office space, travel, external consultants.

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Percentage of AUM

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Research from Citi and Deloitte suggests running costs often equal 0.5–1% of total assets under management. For a $100M family, that can mean $500K–$1M annually.

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How Technology Reduces Costs

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Family office software consolidates data and reduces administrative labor, cutting staff time significantly. For example, automated reporting can save 40+ hours a month, reducing reliance on expensive staff.

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Hidden Expenses to Watch For

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• Outsourced investment research.
  
  
• Legal fees for trusts and estate structures.
  
  
• Cybersecurity upgrades.
  
  

Conclusion

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Running a family office requires careful financial planning. By balancing staff, outsourcing, and technology, families can manage costs while maintaining strong governance and service.

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