Wealth Is The Name of the Game

I always enjoy Bob Clark's articles and found "The Name Game" (Clark at Large, November 2006) interesting. I do have another take on the matter, for what little it may be worth. My suspicion is that the larger firms call themselves wealth managers or investment advisors because that is primarily what they do. They almost all make their money by either selling investment products (insurance fits in there as well for most) or charging a fee for investment management. The solos are more apt to actually do comprehensive planning in my experience. They are also often more willing to take on clients with smaller portfolios.

In my practice, as an example, I will take on a client for a flat fee and do a comprehensive plan that might sort out budget issues and do some forecasts to create the savings plan for retirement and college. There is little or no money for me in the recommendations (usually to use a state 529 plan and avoid sales charges, and use the 401k or IRA). I will never rank with the "big boys," but I don't want to. I'm wealthier than most of them and have no desire to take on more pressure. It's more fun helping people than it is running money (although I don't do a bad job of that part). The investment management part of my practice is just that, a part of the practice.

I agree that if your target market is the high rollers, then you probably want to market in a way that will attract them. And since they probably have their attorneys, etc. lined up, they aren't looking for a "plan." But for many of us, planning is what we mostly do. So perhaps the statistics are a self-fulfilling prophesy.