Wealth management services exist along a spectrum, with traditional financial advisors and family offices representing distinctly different approaches to preserving and growing assets. As personal wealth increases, the decision between these options becomes increasingly consequential for long-term financial success.

Traditional advisors can offer standardized services within established firms, while family offices can provide wealth management exclusively dedicated to serving ultra-high-net-worth individuals and families. This difference in approach affects everything from investment opportunities and tax strategies to privacy considerations and intergenerational planning. For significant wealth, this choice represents not merely a financial decision but a framework that will shape a family's relationship with their assets for generations.

By comparing and contrasting the difference in advisors, you’ll have a comprehensive understanding of which one may be right for you.

Traditional financial advisors typically provide a core set of wealth management services centered around investment portfolio construction and management. These services generally include basic tax planning focused on investment-related strategies, retirement planning with standardized projections and withdrawal strategies, and insurance recommendations to protect against common risks. Many advisors also offer basic estate planning guidance, though complex situations may require external specialists depending on the scenario.

Cost structures for traditional advisors follow several models, including:

● Asset-based fees (typically 0.75% to 1.5% of assets under management)

● Fixed annual retainers ($2,500 to $25,000+)

● Hourly consulting fees ($200 to $500+)

● Commission-based compensation

The advantages of working with traditional advisors include significantly lower cost entry points compared to family offices, established operational infrastructure with regulatory oversight, and standardized processes that ensure consistent service delivery. However, limitations become apparent as wealth grows. There may be fewer customizations, potential conflicts of interest due to product affiliations, limited bandwidth for complex situations, and typically restricted access to exclusive investment opportunities.

Family offices, on the other hand, are private wealth management firms dedicated to serving ultra-high-net-worth individuals and families. Single-family offices (SFOs) serve just one family and provide the highest level of customization and exclusivity, while multi-family offices (MFOs) distribute costs across several families while maintaining high service levels.

The services provided by family offices extend far beyond investment management to include sophisticated tax planning and preparation by dedicated specialists, comprehensive estate planning integrated with investment strategy, legal service coordination across multiple jurisdictions, lifestyle management (private travel, property management, staff hiring), and business succession planning for family enterprises.

Although the approach comes with substantial costs. Fully staffed single-family offices typically require $100 million+ in investable assets to justify expenses, including professional staff (CIO, accountants, legal counsel), administrative personnel, compliance and reporting systems etc.

Multi-family offices may offer a middle ground, which may be a solid option for families with $25-50 million+ in assets.

The depth of service represents the most significant difference between these models. Family offices can offer diverse customization with dedicated professionals who are privileged to the family's financial situation, while traditional advisors may provide more standardized services with personalization limited by firm structure and client load. The family office approach provides comprehensive expertise under one roof, offering coordinated strategies rather than siloed advice from multiple providers.

Privacy and exclusivity create another meaningful distinction. Family offices operate with complete confidentiality, crucial for high-profile families or those with complex business interests. They also provide access to investment opportunities that may be unavailable to investors such as the following:

● Direct private equity deals

● Exclusive real estate investments

● Club deals with other wealthy families

● Preferential access to top-tier investment managers

Perhaps most importantly, family offices address complex family-specific considerations, including developing formal governance structures for multi-generational decision-making, creating educational programs to prepare other members for wealth responsibility, and aligning investment strategies with family values through impact investing or philanthropy.

Asset thresholds serve as a primary consideration when debating the choice between traditional advisors and family offices. While traditional advisors can serve clients at nearly any asset level, family offices are accustomed to much higher levels ($25-50 million for multi-family offices, $100+ million for single-family offices).

Family complexities may also be a factor. For instance, those with multiple households, international aspects, active business interests, or complex tax situations often find the approach of family offices necessary to address their interrelated needs. Similarly, control preferences influence this decision, as family offices provide maximum control over investment decisions and service priorities.

For many families with substantial wealth, many may progress from traditional advisors to multi-family offices and eventually to single-family offices as assets, complexity, and service needs grow. The right choice ultimately depends on aligning wealth management structure with family priorities, values, and long-term objectives.

Written by: Taylor Bushey

ProCore Advisors is a Registered Investment Advisor in the states of California, Oregon, and Texas. Reference to registration does not imply any particular level of qualification or skill. Investment advisory services available only in jurisdictions where ProCore Advisors is appropriately registered. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any securities.