What is a Family Office — and Does Your Australian Family Actually Need One?

More Wealth, More Complexity

When your assets grow from hundreds of thousands into the millions — across properties, trusts, investments, super funds, or philanthropic initiatives — your family’s financial life begins to look more like a business.

But who is coordinating it all? That is where the family office model comes in: offering structure, strategy, and long-term control across generations.

In Australia, more families are adopting family office-style solutions, even without establishing a formal in-house team.

What Is a Family Office?

A family office is a private advisory framework that manages a wealthy family’s affairs. It typically covers:

• Legal and tax structuring
• Investment oversight
• Philanthropy and legacy planning
• Succession and governance
• Administration of private business and real estate

Family offices can be structured in two main ways:

• Single Family Office (SFO): A fully resourced office for one ultra-high-net-worth family, usually managing $50M+ in assets
• Virtual Family Office (VFO): A coordinated group of advisors — such as a lawyer, accountant, and investment professional — who work together without a physical office

Why You Might Need a Family Office

• You manage multiple entities such as companies, trusts, SMSFs, and offshore assets
• You have experienced a liquidity event, such as a business sale or inheritance
• You are preparing the next generation for wealth and want to avoid entitlement or conflict
• You want to reduce tax, protect your estate, and plan for succession
• You value privacy, legal coordination, and strategic governance

Benefits of a Family Office

Centralised Control
Your legal, tax, and investment matters are coordinated under one strategic framework.

Tax Efficiency and Compliance
Proper structure and alignment reduce the risk of tax inefficiencies and ATO issues.

Intergenerational Education
Family offices help educate and mentor the next generation to manage wealth wisely.

Strategic Philanthropy
With tools like Private Ancillary Funds (PAFs), giving becomes structured and values-driven.

Asset Protection
Family offices implement protective structures such as trusts, BFAs, and layered planning to shield wealth from risk.

Case Study

The Lee family owns:

• Four properties
• A private business now run by their children
• A family trust holding $18 million in shares and managed funds
• A plan to donate $1 million to a charitable cause

They do not want a physical office. Instead, they engage a legal advisor to act as the core of a Virtual Family Office, helping to:

• Restructure the family trust for succession
• Draft a family charter
• Establish a PAF for philanthropy
• Coordinate with their accountant and financial planner

The result: clarity, control, and continuity without unnecessary overhead.

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FAQ

Q: Do I need $50M to have a family office?
A: No. Many families with $5M to $30M benefit from a virtual model using a network of trusted professionals.

Q: What is the difference between a family trust and a family office?
A: A family trust is a structure. A family office is a strategic model that coordinates all your structures and goals.

Q: Is a virtual family office just a buzzword?
A: Not at all. It reflects how many modern families operate — without staff, but with a cohesive advisory team.

Q: Can my lawyer be part of the family office?
A: Absolutely. The legal advisor is often the anchor — managing structuring, estate planning, compliance, and governance.

(Note: This article and FAQ are general information only and do not constitute legal, financial, or tax advice. Please seek qualified advice tailored to your circumstances.)

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