The sheer expense of building a family office is a headache for a number of UHNW families; complexity for multi-generational families is a challenge. The study revealed the concerns that such clients have and what advisors should do.

Cost remains the biggest barrier to ultra-high net worth individuals establishing family offices, according to a new survey by Julius Baer and PricewaterhouseCoopers.

The Family Barometer 2025 report, based on the views of almost 2,500 internal and external experts from Europe, Asia, the Middle East and Latin America, found that 40.8 per cent of respondents cited cost as the primary obstacle to creating family offices for clients.

Some 40.8 per cent of respondents said cost was a primary roadblock to creating a family office for clients; 29.5 per cent cited complexity of management; 28.3 per cent said “wealth is not large enough”; 22.9 per cent cited “lack of perceived benefits”; and 9.7 per cent said “everything is managed by a bank.”

A total of 60.4 per cent of respondents said “tax optimisation in multiple countries” is the largest challenge facing UHNW families exposed to many jurisdictions. Just over half (50.1 per cent) said “succession planning across borders” was a challenge, while in third place (37.1 per cent) was “regulatory compliance.”

“Families are rethinking how and where they deploy capital, with private markets and real estate taking on an increasingly prominent role – both for potential returns and for the sense of control and permanence they can offer,” Roger Stutz, head of wealth planning at Julius Baer, and Lisa Cornwell, partner and leader for private clients and family offices at PwC, said in the report’s introduction.

“At the same time, concerns around political stability and security are driving more diversified planning, closer collaboration with trusted advisors, and sharper scrutiny of cross-border structures,” they added.

The 44-page report said that 60 per cent of respondents’ UHNW clients do not have a family office; 21.3 per cent have a single-family office; 7.6 per cent have a multi-family office; 3.8 per cent have a hybrid multi/virtual family office; and 5.8 per cent have another arrangement.

As this publication has noted, the cost of setting up a family office can be tough even for wealthy individuals. The firm Masttro, for example, reckons that a family must have at least $100 million to be a viable proposition; to join a multi-FO requires between $30 million and $100 million, and to use an outsourced family office can be achieved with $10 million or above.

Top of mind
The three main family topics, in descending order, are succession planning; individual and family growth opportunities; and building family legacy/family governance.

More than half (53.4 per cent) of the respondents’ UHNW clients are in Europe; 17 per cent are in Asia; 12.4 per cent are in the Middle East; 7.5 per cent are in North America; 5.6 per cent are in Latin America; 2.1 per cent are in Oceania; and 2 per cent are in Africa. Some 55 per cent of respondents were relationship managers.