When you’re in the early stages of building out a family office, it’s tempting to move quickly. But one of the most common questions I hear is whether starting with fractional roles and outsourced services creates unnecessary complexity down the line, or whether it’s actually the smarter path forward.
The short answer: taking a measured approach isn’t just acceptable. It’s the right strategy for most families.
The $100-150 Million Threshold
Let’s start with some benchmarks. We typically don’t see a full-fledged family office until a family reaches around $100 to $150 million in investable assets or net worth, depending on how the structure is set up. At that level, there’s enough complexity and enough returns being generated to justify the overhead of a true family office: your own in-house CIO, your own tax professional, your own attorney. That means hundreds of thousands of dollars in annual payroll.
If you apply a rough rule of thumb and allocate about 1% of assets toward family office infrastructure and payroll, that gives you $1 to $2 million to work with at the $100-150 million level. That’s when the math starts to make sense.
The Gap Between Complexity and Scale
Here’s where it gets interesting. When you’re in the $20 to $30 million range, complexity is already rising. You start thinking, “It would be nice not to have to worry about X or Y.” A family office sounds appealing. But the returns aren’t there yet to justify a full build-out.
Even if you went from zero to $150 million overnight, you still wouldn’t want to rush the process. Building a family office is like building any other business or team. It takes time to find the right people, establish trust, and integrate expertise.
Start Small, Build Gradually
The natural progression for most families is to build the team slowly and strategically. You begin by outsourcing to high-quality operators in specific areas:
- A trusted estate attorney
- A trusted financial advisor
- A trusted tax professional or CPA partner
- Outsourced services for things like bookkeeping, bill pay, or home management
These are the foundational relationships. You’re not hiring full-time staff yet. You’re working with professionals who can handle the complexity you have today without the overhead of full-time payroll.
When Outsourcing Becomes Hiring
Over time, as your wealth and complexity grow, certain roles start to demand more attention. You might reach 20 or 30 different investments. You might take fractional ownership in smaller companies or become a larger stakeholder in multiple real estate ventures. Suddenly, a full-time CIO starts to make sense just to keep all the moving pieces aligned.
The same logic applies to legal and accounting work. If you’re spending $60,000 or $70,000 a year in retainer fees with an attorney who’s handling estate work, trust structures, lease agreements, and operating agreements for your investments, you start to ask: why not pay $120,000 or $150,000 and bring someone in-house?
That transition happens naturally. The role grows until hiring full-time becomes the more efficient choice.
You’re Not Paying for Complexity Later
One concern I often hear is that starting with outsourced or fractional support will create rework or inefficiencies down the line. In my experience, that’s not the case.
What you’re really doing is building relationships and vetting talent over time. You’re learning who handles bookkeeping well, who you trust with estate planning, who provides sharp investment guidance. Then, when the volume justifies it, you make an offer. You bring that trusted person in-house.
Going slow gives you the chance to build trust and avoid the alternative: going from day zero, knowing no one, to day one, with a team of strangers managing your entire family’s finances. That’s a recipe for misalignment and risk.
The Path Forward
If you’re early in this process, focus on identifying what needs to be done and who can do it well on an outsourced or fractional basis. Build your core team of trusted professionals. As your needs in specific areas increase, that’s when you evaluate whether a full-time hire makes sense.
It’s not about racing to build the org chart. It’s about matching your infrastructure to your actual complexity and ensuring every role is filled by someone you trust. The families that do this well take their time. And in the end, that patience pays off.
This post is adapted from a recent episode of the Scholar Wealth Podcast. For more perspective on building and scaling a family office, listen to the full podcast episode here.