A Family Affair

THESE DAYS, YOU DON'T NEED TO BE A ROCKEFELLER OR A MUSK TO GET WHITE-GLOVE WEALTH SERVICES FROM A PRIVATE FINANCIAL OFFICE.

- KELLY PHILLIPS ERB

In 1882, John D. Rockefeller, the world's richest man, created the first full-service single-family office in the U.S. to manage and invest his fortune, said to be $1.4 billion ($31 billion in today's dollars) at his death in 1937. Fast-forward 142 years, and many members of The Forbes 400 have a family office to help them manage their enormous fortunes.

But so do thousands of other American families who don't belong to the billionaire class. At their core, family offices are a means to invest, preserve and pass on fortunes-not to build them de novo. They're both a safety net and status symbol. "People are busy, and they want to know: 'How are we doing? Is there anything to worry about?"" says Mark Rogozinski, president of Family Office Services for Chicago-based Cresset Asset Management.

Family offices are taking off for many reasons, including increasing wealth and aggressive marketing to the ordinary rich. Baby Boomers and their elders also have concerns about passing on their accumulated wealth (in aggregate, some $84 trillion) and have a desire to involve younger generations in philanthropy. On the other side, the family office providers have access to new technology that can better monitor investment performance and share financial data, making it easier for them to expand. The final impetus is tax savings-the 2017 tax overhaul, coupled with a tax court ruling that year involving the Lender family (of bagel fame), mean that investment expenses which are no longer deductible on individual tax returns can often be written off at the family office level.

It's unclear how many single-family offices now operate in the U.S.-estimates range from 3,000 up to 7,000. But all agree that the number is growing. Deloitte conservatively estimates there will be 3,550 single-family offices in North America in 2025, up 61% from 2019. (For comparison, Forbes counted 880 billionaires in the U.S. and Canada in 2024.)