For the past few years, Canadian Family Offices has been exploring the boundaries that define the family advisory sector in this country. We’ve sought a universal definition of a family office (there isn’t one) and an agreed-upon figure that defines what is meant by “high” and “ultra high” net worth (also elusive).
Now, we ask: At what level of wealth could a family consider setting up a single-family office, and what might that cost? We weren’t surprised to find that opinions vary considerably.
Steve Beauchesne, CEO, Family Enterprise Canada, Ottawa
“What really drives the need for a family office is the complexity of the family’s circumstances and relationships. Some families may start thinking about it around $200 million to $300 million, but others could need it sooner—or not at all. Start with the family, not a dollar figure. Complexity is the real threshold.
“If there isn’t alignment on vision and values, or if liquidity is limited, the office can add cost without adding value. To truly grow wealth and cohesion, the family needs clarity of purpose, strong governance and a team of advisors who know how to collaborate.”
David Blom, advisor and COO, Blackwood Family Enterprise Services, Calgary
“I don’t think you could put a dollar figure on the level of wealth required to open a family office. There are so many family-office variations, and all have a different cost structure and mandate.
“Usually, the family would define the needs, then construct a family office and its costs and cost savings. A cost-benefit analysis would be completed, which would include financial and non-financial benefits. Overall, a prudent process would weigh the costs of accessing these services externally versus internal hires. Included in this analysis are the non-financial benefits that only the family can assess.”
The cost of the single-family office shouldn’t be more than two per cent of a family’s net worth.
Tina Di Vito, First Affiliated Holdings Inc.
Colin Keddy, director, TAAG Family Office, Ottawa
“It’s not unrealistic to think that someone could spend $2 million or $3 million for payroll annually, not counting real estate or technology. So $100 million would be close to the starting threshold for a complete family office where you could have 12 different types of professionals working together.
“Are you truly going to get value out of that? Maybe there isn’t a multigenerational requirement, and you won’t achieve the value that most people attribute to a family office.”
Greg Moore, partner and portfolio manager, Richter Family Office, Toronto
“If you look at it uniquely from a cost-bearing perspective, $250 million is the minimum, and I think it’s closer to $500 million, because the costs can be quite significant. I would also invite families to look at not just the asset base but also the complexity. People often think only about whether to start a single- or multi-family office rather than looking at it through a hybrid set of lenses.
“You may want to create a single-family office structure to administer real estate but in-source other functions. It provides a more cost-effective way to manage some of the administrative aspects and defray costs.”
Thane Stenner, senior portfolio manager and senior wealth advisor, Stenner Wealth Partners+ at CG Wealth Management, Toronto and Vancouver
“What is the complexity of your situation, and what is the annual budget that you’re willing to pay for staff? I’ve seen cases where a family with hundreds of millions of dollars has had two people in-house, and then they’ve outsourced to other third parties. You can have a really complex scenario with $100 million, or you can have a really simple scenario with $1 billion.
“It really comes back to the in-house versus external resources and the annual budget that they’re willing to commit to, not just for this year, but for the next 20 years.” (For more insights, check out What you need to know about setting up a single-family office.)
Tina Di Vito, head, family office services, First Affiliated Holdings Inc., Toronto
“The level of wealth is not the only factor, because a family office can do much more than just manage liquid wealth. I would ask, ‘What do you want the family office to do for you, how many family members will it serve, and how long do you want the office to last?’
“Generally, you need more wealth to support the costs of a single-family office versus engaging a multi-family office, where the costs are shared with other families. The cost of the single-family office shouldn’t be more than 2 per cent of a family’s net worth.”
Lucy Ryan, director, engagement and education, Cole & Associates, Ottawa
“Wealth alone doesn’t determine the need. We’ve seen families with less than $5 million in net worth who benefit from a family-office structure, while others with over $100 million have found establishing a formal family office unnecessary.
“We ask families whether the current generation intends to keep their children tied together through shared assets. Are there multiple entities, investments or philanthropic initiatives requiring coordination and oversight? And most importantly, what are the family’s actual needs, and where do they see themselves in the future?”
Steve Legler, senior consultant, Blackwood Family Enterprise Services, Montreal
“When I first started, I would hear you need $40 million or $100 million, and no, you don’t. A family office is simply the way a family organizes itself to manage its affairs. A dedicated family office for one family would have at least three, four or five employees, so call that $500 million to do that comfortably. But there are other family-office structures where a small number of people are doing a lot of things for a single family.
“I prefer to think in terms of households. A husband, wife and four minor children is one household. When that grows to four households in the next generation, and four to 12, will those attitudes of diligence and hard work remain in place? Maybe not.”
Chris Gandhu, partner and family office leader, KPMG Canada, Calgary
“While $100 million-plus in total net worth is often a starting point, wealth alone isn’t the trigger. Complexity is. Once you add multiple generations, diverse holdings and cross-border structures, a family office stops being a want and becomes a need.
“But if a family lacks clear goals or governance, the office won’t fix that—it will only burn money faster. The best family offices are small engines with outsized horsepower, not bloated bureaucracies. A family office should build more than portfolios. It should build people. That’s how you grow assets and strengthen identity across generations.”
Robyn Hooper, family enterprise consultant, Trella Advisory Group, Vancouver
“To be able to afford someone of the calibre that you need, you need at least $50 million. A lot of family offices are embedded in the business, but there’s risk in having all your personal financial data on the same server. In addition, not every family member is interested in doing the work of a family office.
“A family office is a process, so you need to start with baby steps. Start with governance and strategy and vision, and if you can get that, the rest is just the how, and the how is easy.”
Sarah B. Hood is a Toronto-based writer and book author. She has served as editor of three national magazines and written weekly columns for the National Post. She also serves on the editorial board of Spacing magazine. She writes frequently on business, urban affairs and culture. As a food writer, her work has been translated into Japanese and Arabic. She has taught writing at George Brown College for more than 20 years.
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