You may have clients who have spread their assets among multiple advisors. They’re likely short-changing themselves.

We go over four reasons you can share with clients about why it is important they consolidate assets with one great advisor—you.


Too often we sit with prospects who are trying to manage their own money. They have been doing it for years and as a result, they may have assets with anywhere from five to 10 different investment managers. When they come to see me, they lament that they don’t get the attention that they deserve, that the advisor doesn’t proactively reach out, and that their experience is poor.

None of these complaints surprise me, as we know that clients are not going to get the appropriate attention if they “drib and dab” their money with multiple advisors.

Clients should work hard to find an advisor they trust, and then place their money with that one advisor.


Following are four reasons why clients should not spread their assets around and why it pays to consolidate them with you.

1. A larger sum with one advisor gets you the attention you deserve

Placing small amounts with several different advisors as if you are at a racetrack will get you de minimis results. Advisors are busy and they only have so many hours in a day. Often, advisors will choose to spend more of their limited time on larger clients.

This is why most successful advisors have clearly stated minimums that they enforce, so that they are able to give each client the appropriate amount of attention. Other advisors do not have stated minimums and will just accept any dollar in any format, but you will likely not get their full attention or higher levels of service.

What is even more maddening is that larger clients especially need the time and attention that they are not getting. Ironically, the advisor may not even realize that the client needs this additional attention or that it is a larger client with more complex needs because the client has not shared this information with the advisor.

This approach essentially dooms the relationship right upfront. Even more ironically, the client has only herself to blame, and yet she is more likely to blame the advisor for the lack of attention and great service.

Either way, the logic is inescapable: With limited capacity for the advisor and limited capacity for the team, their attention will go to larger and more complex accounts. Are you one of those larger accounts? If not, then it stands to reason that you will not get the attention that you would like. This is an example of where multiple advisors do not create additional benefit, or in other words, 1 + 1 does not equal 3.

Fortunately, this problem can be solved if you consolidate your assets with one advisor. This would enable you to likely meet the minimum and get that additional attention.

When a prospect explains their situation to me, I am very honest, and I let them know that the responsibility for their disappointment lies with them, and not with the advisor because the advisor is essentially in a no-win situation, without the information or the tools to do a good job.


2. Spreading assets around creates inefficiency and duplicative efforts

Clients who spread assets around don’t realize the distortion this can have on the structure of their portfolios.

Advisors create portfolios based on the information that they are given from their clients, as well as their own investment philosophies. When a client gives limited information to different advisors, those advisors are forced to structure portfolios based on incomplete information and the client’s whole portfolio might be negatively impacted.

For example, if two advisors have similar investment strategies and both overweight technology, the client may end up doubly overexposed to certain areas of the market unwittingly. In addition, the advisors will have no idea that they have created additional risk for their client because they have no idea what is going on with these other advisors.

In many instances, the client is not going to understand portfolio management well enough to identify these issues soon enough. Thus, the redundancies or duplication of efforts will get exposed at the worst possible moment during some type of market pullback or decline.


3. Spreading around assets undermines an advisor’s ability to provide holistic planning

Clients who make deposits with several advisors underestimate the contributions that an advisor can make to their financial well-being. These clients mistakenly believe that an advisor can only offer investment management advice, and therefore it shouldn’t matter that there are investments in other places.

However, many advisors are able to offer financial planning advice, which is incredibly important to clients. The holistic financial planning advice could cover retirement planning, Social Security planning, college planning, and even creating or updating a plan to address increasing inflation and high-interest rates.

If a financial advisor only knows about part of your assets, he or she will only be able to provide advice on a portion of your finances, and that advice is more likely to be incomplete.


4. Consolidating assets enables clients to get advanced tax-planning advice

The biggest reason for clients to invest time upfront to find a great advisor is so they can receive advanced tax planning advice.

When a single advisor is aware of your entire situation and you have enough assets with that advisor to qualify for premium treatment, that advisor can provide advanced tax planning services that can save you hundreds of thousands to possibly millions of dollars over your lifetime.

These advanced tax planning services could cover IRA distribution planning, Roth conversion planning and consistent advice over many years to decrease the lifetime tax bill. There are also other situations where tax planning can take center stage, such as with married couples with wide age differences, same-sex couples, widows, clients with large retirement balances and clients who are about to retire in a few years.

Clients often underestimate the value of advanced tax planning advice, particularly if they have large retirement account balances.

A lot of these services have recently come to the forefront with new technology and tools, and enable advisors to provide superlative services in tax-planning areas. However, many clients will never know what they are missing, because their advisors may not even be aware of the true balances in their accounts and how it could affect their tax situations. This is why it is crucial for clients to consolidate assets with a single advisor.

Of course, the logical reply to the above recommendation is “What if the one advisor who has all of the assets steals my money?”

Admittedly, there is always the remote risk of some type of bad actor with nefarious intentions. But just as we don’t allow the remote risk of getting in a fatal car accident to deter us from driving, we can’t allow the incredibly low possibility of a dishonest advisor acting poorly to force us into a bad decision that will impact our family’s lifetime wealth.

I would have the same response if someone also objects to consolidating his or her assets on the grounds that the advisor may be incompetent or makes poor investment decisions. All you are doing is trading one risk (that you may end up with a dishonest or incompetent advisor) for another more likely risk (ensuring that you will not receive holistic or quality assistance).

Yet the trade that you are making guarantees you and your family lose by ensuring that you will not get the help you need.

Embedded in these actions is the skepticism that advisors are not able to do their jobs, hence clients hire many advisors to minimize harm. Also embedded in the “multiple advisors” approach is a form of laziness, where the client prefers to hire many advisors (all or some of whom may be incompetent) instead of truly dedicating the time and resources to hire one or even two great advisors.

However, when dealing with someone’s family’s wealth accumulated over decades, it would stand to reason that a prospect should dedicate the time to find a great advisor just as he would dedicate the time to build a great home or research locations for a great family vacation.

Performing research and dedicating oneself to hiring a world-class advisor could be the best decision that a family ever makes. Don’t give it short shrift!



Source: Article Written By Debra Taylor, CPA/PFS, JD, CDFA – 2023