When the decision is “outsource or go in house,” the answer for many family offices is “some of each.”
The Single Family Office Compensation Report from Morgan Stanley Private Wealth Management and Botoff Consulting, a survey of over 400 single family offices in the United States, provides an interesting snapshot of how family offices balance hiring in-house staff with engaging outside expert help:
* The services most likely to be provided in house: family governance (57% in house, plus 27% who said they use both in-house and outsourced resources) and financial planning (53% in-house plus 38% both). Close behind were concierge services (49% in house plus 21% both) and succession planning (47% in house plus 39% both).
* The only service that a majority said they outsource is legal services, outsourced by 54%. This is also a common area for mixing in-house and external resources: 35% said they use both types of legal services. Only 4% said all their legal services are provided in house.
* Mixing in-house and external resources is very common – in fact, the majority of family offices take this approach for tax planning (59%), insurance and risk management planning (52%), estate planning (65%) and tax compliance and preparation (52%).