HNW-Focused Advisors More Team-Focused Than For Mass Market – Cerulli

Tom Burroughes

17 February 2022

A study of US advisors by Cerulli Associates, the research and analytics firm, shows that firms concentrating on high net worth clients work more frequently as a team than those serving less affluent investors.

Some 43 per cent of practices with core markets between $500,000 and $2 million, and 60 per cent of practices with core markets between $100,000 and $500,000 operate as solos, compared with only 29 per cent of advisor practices serving more affluent investors.

The findings come from the latest Cerulli Edge – US Advisor Edition.

The organizational structure of an advisory practice is correlated with the core market served by the practice, with practices oriented toward serving HNW investors more likely to operate in some form of team, Cerulli said.

Specialized teams are often more fully equipped to meet the needs of the HNW and ultra-high net worth investors with services that cater to their needs, the report said.

“Practices oriented toward households with greater than $2 million in investable assets are more likely to offer comprehensive wealth management service as a core service than are practices that serve households in lower wealth tiers,” it said.

For advisors with a core market of $2 million to $5 million, 59 per cent offer estate planning, 54 per cent provide tax planning, and 60 per cent offer charitable planning. In comparison, of advisors with a core market of $100,000 to $500,000, 50 per cent offer estate planning, 41 per cent provide tax planning, and 36 per cent offer charitable planning.