What are Family Office Services, and What Type of Investors are They Suited For?

Alevin Chan

Alevin Chan

Last updated 20 April, 2023

Family office services provide a range of professional services aimed at the needs of the ultra wealthy. What do these services entail, and how rich do you have to be before you start needing them?

Singapore’s status as a global financial hub naturally fosters a need for wealth management services. In particular, Family Office Services seem to be in great demand on our little island – at last count in 2021, there were 700 family offices established in Singapore.

One little known fact is the positive social impact that family offices have been making. The Asia Impact First fund launched by DBS and Heritas Capital, in which the DBS Foundation has invested $10m, recently raised $20m in 15 March 2023. 

The funds will be invested in businesses with social and environmental focuses across the region, with the focus on impact investing aimed at catalysing social change. 

The importance of this sector becomes apparent when you consider that family offices generate employment in Singapore by employing advisors and investment professionals. They also indirectly by working with external finance, tax and legal professionals on wealth planning and operational matters.

They also expand the pool of capital for Singapore-based startups and business ventures, and the funds that invest in such companies.

Companies may also benefit from the guidance offered by the principals of these family offices, many of whom are owners of successful businesses.

Related to this topic: Dreaming of Running Your Own Business? Here’s How Much Popular Franchises Cost in Singapore


What is a family office?

A family office is a private wealth management firm that caters to the needs of ultra-high-net-worth individuals (UHNWIs). It offers a suite of personalised services that can range from financial services, business advisory and legacy planning to charitable giving and concierge services.

Traditionally, a family office is set up by a UHNWI family to help manage their affairs. Such setups are known as Single Family Offices, and solely serve a single family. Today, there exists multi-family office services that are able to take on several wealthy individuals or families simultaneously as clients.

While family offices largely offer financial management services, they are by no means the only type of family offices out there. Other types of family offices include:

  • Personal assistant office, which focused on helping clients with daily tasks, such as arranging flights and accommodation, to managing appointments and administrative tasks.

  • Concierge or lifestyle office, which handles more complex logistical tasks, including arranging for insurance for family members, managing household staff, making entertainment or dining recommendations, or liaising with organisations and entities on the family’s behalf.

  • Administrative family office, which may be necessary if a UHNWI family has multiple complex structures in place to manage personal and financial affairs.

Commonly, even family services that focus on financial management and advisory may offer some or all of these services as well.

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What are the roles and responsibilities of a family office?

When someone has tens or hundreds of millions dollars worth of assets, the usual rules of personal finance don’t apply any more.

Sure, the basics are still important, but beyond a certain point, it becomes less about keeping track of expenses and more about asset management.

Without belabouring the point, needs of the ultra-rich are simply different (and a lot more complicated) from those who are lower on the socio-economic ladder.

Family offices are primarily concerned with helping UHNWIs and their families manage their affairs, which will differ according to the background and circumstances of each.

Nonetheless, it can be said that all family offices have a universal goal, which is to help their clients grow their fortune and preserve it for future generations – a task which may necessitate several high-level skills and range of knowledge and expertise.

As such, some of the roles commonly employed in family offices include:

  • Investment and wealth managers: These financial professionals are charged with looking after the family’s fortune. They may make investments, seek out financial opportunities, or set up trusts and new structures as necessary.

  • Tax advisors: Because the ultra-rich are taxed differently, family offices employ dedicated accountants and tax lawyers to advise on taxation matters and ensure the most favourable tax treatment possible. UHNWIs can save a substantial amount in taxes with their help.

  • Lawyers: Additionally, managing the affairs of the ultra-wealthy may require legal advice on a variety of subjects, such as real estate law, investment concerns, trusts and estates, and perhaps criminal law. Thus, a family office may employ or retain qualified legal counsel so as to ensure that the client’s interests are always protected.

Related to this topic: Three Key Financial Moves High-Income Earners Need to Make for Better Wealth Management


How rich do you have to be to need family office services?

Throughout the article, we’ve been mentioning the term UHNWI. Well, that isn’t just a fancy acronym used to describe the millionaire-in-the-street.

There isn’t a fixed cut-off point but generally, to be considered ultra-wealthy, you’d need to have investable assets of between USD30 million to USD100 million, or more.

But just because you have that level of wealth doesn't mean you should go looking for family office services. Given the high level of expertise involved, such services operate at a premium level and do not come cheap.

In fact, some estimates point to USD 250 million as the point beyond which one might require (or can afford) a dedicated family office.

Related to this article: Uniquely Singaporean Things We Do To Accumulate Wealth


Priority banking may be a better fit

So what should you do if you’ve made your 1st million or two, and looking for a safe place to optimally grow your money.

Well, priority banking may be the answer. Priority banking offers several similar wealth advisory and management capabilities as family offices, although a bank may not be able to personally fetch your freshly pressed suit from the dry cleaner’s.

You can access personalised insights and recommendations that have been screened by a team of investment and financial professionals, and with your Relationship Manager, create a custom-built financial portfolio to help you grow your wealth and preserve it for the next generation – just like how a family office does.

That’s not forgetting that priority banking also often provides a slew of perks and privileges that extend beyond banking, allowing you to enjoy benefits for travel, dining, entertainment and more.

And perhaps the best part, priority banking is much less costly than setting up an entire family office. In fact, the only “cost” is maintaining the requisite level of funds in your account to keep your priority banking relationship active.

Related to this topic: 9 Exclusive Priority Banking Benefits That You Probably Didn’t Know About

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An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.

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