Some discretion is inevitable for success. There can be a real price paid-in terms of time and energy spent-for low-asset clients, especially if an adviser is trying to maintain the same high standard of service for all accounts. It's why many advisors say it's bad business to ignore minimums.
"It's very time-intensive to manage accounts. We've got to do asset allocations, figure out tax strategies and more," says Frank Armstrong, founder of Investor Solutions, a Miami area advisory firm.
And as far as making a bet that a small account might morph into a large one through a windfall of some sort, Armstrong says it's a risky move, especially since once a client reaches retirement age, there's a good chance they'll be eating away at the principal investment anyhow.
"The vast majority of small clients become even smaller clients," Armstrong says.
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