As more older clients begin withdrawing from their retirement accounts, and younger clients become responsible for a larger portion of revenue, advisors may need to diversify their services and the pool of experts they refer to clients.
“Today, millionaires want help investing, diversifying and crafting a financial plan,” Walper said. “In the future, they’re going to want and need tax-advantaged strategies and to establish an estate plan, they want advice-oriented, planning-oriented solutions for their life across stages. They want an expert on long-term care—if you’re not already pairing up in your community with an expert, you should.”
Walper said that these non-investment services were low-hanging fruit for advisors looking to add value to their practice.
Younger investors are more likely than their elders to want to use robo-advisory services, McBreen said, but that may also present an opportunity for traditional advisors.
“At certain points of their lives, technology and robo-advisors may be the best solutions for investors,” McBreen said. ”It’s an interesting way to rethink the robo-advisor issue at to position yourself as a tech-based solution for these investors.”
Advisors looking to add additional assets and revenue to their practices may not have to look far, according to Walper.
“Your wealthy clients, on average, are only allocating around 22 percent of their wealth with you,” Walper said. “You should be asking on a regular basis to make sure you have a current pulse on your clients’ assets. It’s easier to get additional assets from a current client than it is to get additional clients.”
The misconceptions don’t stop at assets—the Department of Labor’s implementation of a fiduciary standard for the financial services industry has brought conversations about the standard to the forefront.
The problem, Walper said, is that many wealthy investors don’t know what defines a fiduciary relationship.
“Eighty percent of millionaires say their relationship with their advisor is a fiduciary one, but what’s important is how they define fiduciary,” Walper said.