Not to Save Money: Why Family Offices Hire Outside Firms

Family offices do not hire outside firms to save money. In J.P. Morgan Private Bank’s 2026 survey of 333 single family offices, about 80% outsource at least part of their portfolio, yet only 28% named reducing costs or resource burden as a main reason (CNBC, 2026). They are buying access to managers, products and deals they cannot reach alone, and judgment they cannot afford to keep on staff.

They also rarely buy alone. About six in ten run an investment committee (UBS, 2026; J.P. Morgan Private Bank, 2026). A firm that opens with a discount and a charming founder is answering a question nobody in that room asked. The firm that wins writes for the committee: a paper it can table, a record it can check, and an offer built around access.

A growing market that does not shop on price

Deloitte Private estimated 8,030 single family offices in the world in 2024, up from 6,130 in 2019, an increase of 31%. It projects 10,720 by 2030 and puts their assets under management at US$3.1 trillion, rising to US$5.4 trillion by 2030 (Deloitte Private, 2024). Most are young: 68% were established after 2000, and nine in ten serve first, second or third generation families (Deloitte Private, 2024). Many are still deciding what to build inside and what to buy.

The offices in J.P. Morgan’s sample are large, with an average net worth of US$1.6 billion across 30 countries. Running one is expensive. The average annual operating cost is $3 million, rising to $6.6 million for offices with more than $1 billion in assets, and 25 to 28% of costs go to external services such as legal, trading and cybersecurity (J.P. Morgan Private Bank, PR Newswire, 2026). CNBC reported that the $6.6 million figure had risen by $500,000 since the bank’s previous poll (CNBC, 2026).

The money goes to people. William Sinclair, global co-head of the bank’s family office practice, credited much of the increase to pay for investment talent, the largest part of operating budgets. “There is a war for talent,” he told CNBC, adding that family offices compete with other financial businesses, private equity and hedge funds among them, when they try to build out an investment team. He attributed the spread of outsourcing more to that shortage than to any wish to cut costs (CNBC, 2026).

An office that cannot hire the specialist rents one. That is why price is such a weak lever with this buyer.

What they say they are buying

J.P. Morgan asked offices why they work with external advisers. The answers rank access and judgment far above savings.

Sources: J.P. Morgan Private Bank, 2026, for the top six; CNBC, 2026, for cost.

“Notably, cost is not one of the top motivations for working with an external advisor,” the report’s slide reads. Elisa Shevlin Rizzo, who leads the bank’s family and family office advisory practice in the US, was blunter at the launch: “In fact, it’s anything but cost.” Cost, she said, “doesn’t even come into the top six reasons our clients are outsourcing certain functions” (J.P. Morgan Private Bank, 2026).

After investment management, legal is the function family offices most often buy from outside (J.P. Morgan Private Bank, 2026). Some 52% of offices outsource legal services, ahead of trading and market execution at 45% and cybersecurity at 38% (J.P. Morgan Private Bank, PR Newswire, 2026). Shevlin Rizzo described the usual pattern at the launch: an office may have a general counsel or someone with a legal background in a C-suite role, “but the day-to-day legal work is often provided by an outside law firm” (J.P. Morgan Private Bank, 2026). For a law firm, the person reading the proposal may well be a lawyer, and a demanding one.

BlackRock’s 2025 survey of 175 single family offices points the same way. Respondents reported gaps in internal expertise around reporting (57%), deal sourcing (63%) and private-market analytics (75%), and many look to third-party partners for investment and technology expertise (BlackRock, 2025). The gaps are skill and reach. A lower fee fixes neither.

The buyer is a committee

UBS surveyed 307 family offices across more than 30 markets, with an average net worth of US$2.7 billion, for its 2026 report. Sixty percent operate with investment committees, and over half use structured budgeting frameworks (UBS, 2026). J.P. Morgan found the investment committee to be the most common governance structure, at 64%, with 42% of offices seating both family and nonfamily members. In the same survey, 27% use external advisers who conduct periodic portfolio reviews (J.P. Morgan Private Bank, 2026). Different samples, same answer. Most of these decisions pass through a room.

The room is also busy. For the first time, 60% of family offices told UBS they plan changes to their strategic asset allocation in the next 12 months, the highest level UBS has recorded (UBS, 2026). A committee that is reworking its allocation is also a committee that will look again at who helps it do so.

Governance around those committees is uneven. Fewer than half of the UBS offices have formal governance frameworks with board-level oversight, and only 35% have a defined succession plan for the office itself (UBS, 2026). An adviser whose paper makes the committee’s own process easier is doing it a service.

A committee changes the sale. The person you meet rarely decides alone. Your contact, perhaps a chief investment officer or general counsel, has to retell your case in a meeting you will not attend, to family members who may not share the vocabulary and to nonfamily professionals trained to find the weak point.

Whatever you said at a good lunch is lost by the second retelling. What survives is paper.

So write the pitch as a committee paper. One page states the problem, the proposed scope, who does the work, how the work will be reviewed, what it costs and how the engagement ends. Appendices carry the record, the references, conflicts, security and insurance. A committee can table that, minute it and compare it with the next firm’s.

Access is the offer, a discount is a warning

If 57% are buying access to managers and products and 43% are buying deal flow, access belongs in the first line of the offer. For a law firm, access means named specialist counsel in the jurisdictions the family actually touches, and working relationships with the registries, regulators and co-counsel that make a file move. For a tax adviser, it is the specialist on the one question that decides the structure. For an investment adviser, it is the manager or co-investment the office could not source alone. Describe it as named doors with dates, never as a “global network”.

A discount points the wrong way. These buyers say they choose on record and judgment, so a price cut in the opening paragraph tells a committee you expect to compete on the factor it ranked below six others. It also invites the question committees are built to ask: what is being cut? Price belongs in the paper, stated plainly, after the case is made.

Record needs the same discipline. “Track record of performance and investment discipline” is two things, outcomes and the process that produced them. Legal and advisory firms cannot publish client results and should not try. They can publish process: how a matter is staffed and reviewed, how conflicts are cleared, how long each stage usually takes, and what the firm has written in public on the questions the office faces. Reputation with similar clients is answered by references who agree to take the call, not by a wall of logos.

One more figure deserves attention from boutiques. A third of offices, 33%, listed over-reliance on providers or individuals among the top five risks to the continuity and effectiveness of the family office (J.P. Morgan Private Bank, 2026). A firm whose entire value sits in one partner is that risk. Show the bench: who covers when the lead partner is away, and who else knows the file.

Due diligence arrives before you do

Expect a family office to check an adviser the way an institution checks a manager. Cybersecurity is outsourced by 38% of offices, and 32% named it their greatest service need (J.P. Morgan Private Bank, PR Newswire, 2026). An adviser who will hold the family’s structure charts, passports and bank details sits inside that risk, and a careful office will ask how those documents are stored and sent.

The questions are predictable, so the answers can be written before the first meeting. The committee will want people it can call, the firm’s conflicts and how they are cleared, how documents are protected, the insurance behind the advice, who takes over when the lead partner cannot, and how fees are set and the engagement ended. A short pack that answers all of this, ready to send the day after the first conversation, tells the committee the firm has done this before. It is the track record in a form they can verify.

This dossier describes how family offices say they buy. It is not legal, tax or investment advice.