Why (and When) to Partner with a Wealth Strategist

The new growth narrative for financial advisors is one that includes “hybrid” affluent investors, personalization, integrated wealth and banking services, and digital capabilities, according to a recent McKinsey report.¹ To stay ahead of the curve, financial advisors are partnering with wealth strategists to help them attract and retain high-net-worth clients with ease. A wealth strategist enables advisors to offer tailored solutions and services to high-net-worth investors in a scalable way.

For most advisors, client relationships are the lifeblood of their business. Advisors who bring partnerships into the relationship may wonder how to position the partnership with their clients. Depending on the role that the partner is serving, it can be confusing to the client, making it that much more important for advisors to articulate their value in the process.

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Clients Want Expertise

According to our own proprietary research:²

• 90% of investors agree that their advisor should leverage the resources, knowledge, and support of external experts to help with research, strategy, investment planning, and management.
• 80% of investors think more highly of an advisor who amplifies their expertise by leveraging the best intellectual capital and investment ideas and applying them to their portfolios.
• 78% of investors believe the best advisor is the one who knows them well and creates the best network to support them.

High-net-worth clients are among the general population of investors who want a personalized experience — and, often, they have a set of unique circumstances and considerations that require a more customized investment approach.

To that end, advisors are leveraging the expertise and customized solutions of wealth advisory specialists. Because the partnership is client-facing, advisors should carefully consider which provider to work with in this capacity and choose one that will never compromise their relationship with their client. Let’s consider how that partnership works and how responsibilities might be allocated.

Wealth Strategists: How They Help

Discovery and Investment Recommendations

A wealth strategist can assist in the discovery process, working alongside advisors and their clients to understand goals and objectives, along with existing investments and any special considerations, such as tax circumstances. From there, their portfolio consultants can design a customized portfolio around client needs, which could include ESG criteria, charitable initiatives, estate and legacy planning considerations, custom indexing, or other investment solutions to meet specific needs of high-net-worth investors.

Economic Perspective and Updates

One of the biggest advantages for advisors partnering with a wealth advisory provider is the ability to leverage the perspective and updates from their highly credentialed investment teams, CFA Charterholders, client portfolio managers, market analysts, and support teams. As part of the vetting process, advisors should consider the partner’s investment philosophy and approach, ensuring they align with their own. The partner becomes the go-to resource for market commentary and trusted guidance.

Portfolio Optimization

Wealth advisory providers will work with advisors and clients to design and implement personalized investment solutions that are tailored to each individual client. As part of that process, their portfolio managers will proactively monitor investment activity and make adjustments as needed to remain aligned with client objectives. Robust wealth advisory providers offer a dedicated client portfolio manager (or team of managers) who will provide ongoing portfolio reviews for advisors and their clients, helping to ensure the clients' needs are being met and making adjustments as needed.

Proactive Tax Management

Perhaps the most important aspect of a tailored investment solution, particularly for high-net-worth investors, is the opportunity to effectively manage taxes. A wealth advisory provider can proactively monitor client portfolios to maximize tax management opportunities, including methods such as effective tax transitions, tax loss harvesting, asset selection, and other tax-smart strategies. When clients are ready to begin taking distributions from their portfolio, a wealth advisory provider can assist in setting up the most tax-advantaged strategies. Proactive tax management can be invaluable in helping clients manage their tax burden, achieve higher overall returns, and ultimately, provide additional value to the experience.

Financial Advisors: The Trusted Guide for Clients

Central Point of Contact

By partnering with a wealth advisory provider, advisors are better equipped to focus on the client relationship and ensure the client's needs are met by:

• Acting as the centralized point person and provider of service
• Coordinating a team of experts and specialists to help ensure the client's needs are met
• Staying focused on collaborating with and advocating for the client

Independent Voice

Leveraging a provider enables financial advisors to remain seated on the same side of the table as their client, advocating for the client and helping to ensure their needs are met. For high-net-worth investors in particular, this can help reinforce trust between advisor and client.

Comprehensive Wealth Planning

Wealth advisory specialists are accessing only a portion of the client’s entire wealth picture. Advisors can provide a broader, more full-picture analysis, identifying new opportunities. Advisors may find ways to leverage the additional wealth services, such as business valuation, charitable funding, trusts, banking and lending, and other partner services offered by the wealth advisory provider to provide a one-stop-shop wealth experience for clients. 

Client Behavioral Coaching

By bringing in a wealth advisory provider, financial advisors can effectively remain focused on building and strengthening client relationships through education, coaching, and planning around investor tendencies and behaviors.

Advisors should carefully vet providers to find one that aligns with their own investment approach and philosophy and will work in partnership with the advisor to meet the client’s needs.

In short, the partnership between an advisor and a wealth strategist can open new doors to serve high-net-worth clients and better prepare for the next decade in wealth management.

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¹Source: US wealth management: A growth agenda for the coming decade, McKinsey & Company, February 2022.

²Source: Orion Proprietary Research: Orion’s Research Initiative maintained a +/- 2.9% margin of error among consumer investors across generations and a +/- 3.8% error rate among Financial Advisors. A mixed methodology was applied that included a robust base of more than 2000 constituents in the online surveys and dozens of in-depth interviews on the topic, 2021.

³Source: As the high-net-worth seek out new wealth managers, how do you retain clients and capture money-in-motion?, PWC, 2023.