Family Office

The why, who, what and how of starting a family office

Understanding the Family Office

As families navigate increasing financial complexity and multigenerational planning, the family office provides a structured way to coordinate investments, governance, philanthropy and long-term legacy objectives.
Within this context, J.P. Morgan Private Bank engages with family offices globally through ongoing research and dialogue to inform the broader conversation around how families organize, govern and sustain wealth over time.
Determining if a family office makes sense for you starts by considering four key decision points, outlined below.

More and more families with multigenerational wealth are starting family offices to help them manage, sustain and grow their financial and nonfinancial assets. Family offices can offer a personalized array of meaningful benefits based on each family’s specific needs and wealth stewardship goals—from customized, holistic financial asset management to centralized professional and administrative services, to governance strategies and building an enduring legacy. Determining if a family office makes sense for your family—and the right approach for your needs—starts by considering these four key decision points:

1. Determining the purpose of your family office

There are many catalysts that may prompt a family to consider establishing a family office, such as a liquidity event, growing complexity of family assets and/or expansion of the family itself. While it can be tempting to jump straight to the types of services you might want the family office to provide, it can be even more powerful to first take a step back and view these in context of the family’s overall vision and values. Doing so can help frame the intended purpose of the family office from a more strategic perspective to help position it for long-term success.

Family values

Legacy

Success

Time

Purpose

2. Who will be your key family office stakeholders?

Next, develop a clear understanding of who will be served by the family office, how they are related and how they will engage with one another. It can also be useful at this point to take an inventory of family capital (e.g., core operating business(es), other operating companies/entities, financial investments and dividend/distribution payouts) and spending commitments (e.g., lifestyle, philanthropy, taxes).

Who will be served by the family office?

Are there specific family considerations?

How will the family approach ownership, management and governance?

3. What types of services and structures make sense for your family office?

Most family offices are initially created to manage the family’s financial wealth.

Over time, the scope of family office services can expand significantly as needs become more complex. Once priorities are defined, families can determine which services are best managed in-house,outsourced to external advisors, or delivered through a hybrid approach, along with the associated resource and cost considerations.

Typical types of family office services: Family office services may include strategic wealth management, investment management, real estate and speciality asset management, administrative and fiduciary services, tax and succession planning, philanthropic oversight, financial education, family governance, bookkeeping and bill pay, household staffing oversight, scheduling and administrative support, and other concierge or lifestyle services.

Current state of affairs and cost considerations: In assessing the appropriate scope and structure, families typically consider how services are currently managed, which functions are handled directly versus outsourced, whether advisors coordinate effectively, whether existing technology meets the family's needs, the current cost structure, expected startup and ongoing operating costs, and the planned economic or operating model.

Structures: Family offices can take a variety of forms and serve one or multiple families. However, the majority fall into one of four archetypes:

Virtual family office (VFO)

Embedded family office (EFO)

Single family office (SFO)

Multi family office (MFO)

Standalone family offices also may take several legal forms, each with different tax attributes, including the potential deductibility of expenses. It is important to be aware of potential regulatory requirements, and to seek sophisticated legal and tax counsel at this stage.

Legal structures

Compensation models

Tax attributes

Regulatory considerations

4. How to build a strategic business plan for your family office

Once you are ready to start moving into action, it is time to begin creating a business plan around how you can implement your strategic vision into actual design.

Start by crafting your mission statement, setting forth the anticipated legal structure, and setting clear guidelines for decision making and governance on investments and other key decisions.
Outline specific cost considerations, bearing in mind staffing (in-house versus outsourced), operations, technology and cybersecurity, taxes, accounting and other advisory services.
Determine the expected economics model and how costs are to be paid.
Scope out how much time you expect to commit to the endeavor.
Define who will lead the office and if other family members are willing and able to participate.

It also can be important to begin determining if there is universal family buy-in around these issues.

This is where you start focusing on the details. And remember, you don’t have to go it alone.

Looking Ahead

Family office planning is an ongoing process that evolves alongside family needs, market conditions and long-term objectives. As part of its broader engagement with families globally, JPMorgan Private Bank regularly undertakes research and publishes thought leadership on the family office landscape — including the 2026 Global Family Office Report — to support informed, forward-looking decision-making.

We can help

Your J.P. Morgan team can help you navigate the opportunities and complexities of deciding whether a family office may make sense for your family. Contact us today to discuss your options and for additional resources regarding family offices.

Thinking of starting a family office? Four key decision points to consider.

Elisa Shevlin Rizzo Head of Family and Family Office Advisory

Anita Sarafa

Midwest Wealth Advisor Team Lead

Published May 10, 2024

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The why, who, what and how of starting a family office

Understanding the Family Office

Understanding the Family Office