Growing Your Business When Assets DropSubmitted by American Endowment Foundation on May 20th, 2019
By Eric Kinaitis
A recent study by PriceMetrix, surveying 25 wealth management firms, indicated that a change in fundamental behaviors has helped firms grow their revenue despite a decline in assets.
The article in Wealth Management highlights the 2018 research by PriceMetrix published within their State of Retail Wealth Management 8th Annual Report. The study reviewed transactions representing 12 million investors and $6 trillion in assets and provided a window into a contradiction. Despite assets managed per advisor declining 7%, revenues per advisor grew 6%.
How did this occur? The study indicated three areas that brought this revenue growth:
- Increasing services for existing clients
- Expanding outreach to “next gen” clients
- Growth of new client relationships
By understanding the charitable interests of existing clients, advisors can provide a relevant solution in managing those assets in a way that is tax-smart, investment-wise, and within the control of the financial advisor. For those advisors who are uncertain on how to start that conversation with their clients on understanding their charitable interests, American Endowment Foundation (AEF) provides an easy-to-use checklist to help them get started.
Understanding the charitable interests of current clients also paves a road to getting to know “next gen” prospects. An additional study by J.D. Power determined that 58% of advisor clients have never been asked about how they want to transfer their assets to their next generation. The concept of family estate planning and charitable planning can function as an introduction to the “next gen” heirs of your current clientele and solve this current gap.
Lastly, the ability to position a donor advised fund as a solution for a variety of financial concerns provides an advisor a “Swiss-army knife” of answers. From no longer desired real estate to tax savings, all the way to business succession and handling bequests, the Thought Leadership Library at American Endowment Foundation has helped hundreds of financial advisors use a DAF to solve their clients’ concerns.
At AEF, we look forward in showcasing how our DAFs can help advisors prosper by better helping their clientele. Please contact us or call 1-888-966-8170 with any questions.