ELITE ADVISOR BEST PRACTICES

The Wealth Management Edge

The single best way to build a hugely successful business

By John Bowen, founder and CEO of CEG Worldwide

Key Takeaways:

  • Advisors who use a true wealth management model outpace their peers across all major measurements of success.
  • True wealth managers earn, on average, $600,000 more annually than investment generalists who don’t use the wealth management approach.
  • True wealth managers make smarter business decisions regarding who they work with, the number of clients they serve and how they serve their clients.
  • Just because your business card says ”wealth manager“ on it, that doesn’t mean you’re a true wealth manager.


Advisors who are thinking about making the transition to a wealth management business model often are skeptical that the wealth management approach will have a truly meaningful impact on their firms. They fear that implementing a truly comprehensive suite of products and services will take an enormous amount of time without delivering a commensurate payoff for their clients and their revenues.

If you share such concerns, I’ve got some great news for you: Advisors who use a true wealth management business model outpace their peers across all major measurements of success.

Here’s how they do it.

Wealth management defined

It’s important to realize that wealth management is a highly defined process that consists of several key components. Genuine wealth managers use a consultative approach to construct integrated solutions that encompass all types of financial needs.

In its simplest form, wealth management comprises three phases:

  • Using a consultative process to establish close relationships with clients in order to gain a detailed understanding of their goals and their most important financial wants and needs.
  • Offering customized choices and solutions designed to fit each individual’s needs. This select range of interrelated financial services and products might include, for example, investment management, insurance, estate planning, retirement planning and charitable gifting vehicles.
  • Delivering these customized solutions in close consultation with clients and their other professional advisors. The wealth manager works closely with clients and their other professional advisors—such as their CPAs, estate planning attorneys and insurance providers—on an ongoing basis to identify their specific needs and design custom solutions.

When CEG Worldwide evaluated 2,094 advisors, we found that a mere 6.6 percent qualified as true wealth managers. The rest—93.4 percent—continue to use a traditional, investment-generalist approach. Investment generalists might offer their clients many different products, but they do not make consulting an essential part of their business model. Instead, they tend to be transactional—their focus is on selling and gaining just enough information to solve a particular issue at hand instead of taking a comprehensive approach with solutions.

The upshot: Even if your business card says “wealth manager“ on it, the data shows that you’re probably an investment generalist.

Wealth managers win

Why should you care? The answer is simple: Investment generalists simply cannot compete with wealth managers.

Here’s the proof: The average annual net income (before taxes) of wealth managers is tremendously higher than that of investment generalists—$881,000 versus $279,000. That’s an additional $602,000 a year on average for wealth managers! I’m guessing that amount of money might make a substantial difference in your life.

Our research also shows that wealth managers’ superior level of success comes from systematically making intelligent choices about their business practices in key areas such as:

  • Number of clients. While the typical investment generalist serves 269.3 clients, wealth managers serve just 101.1 clients on average. A smaller client base allows wealth managers to spend more time cultivatingand strengthening client relationships and loyalty.
  • Client acceptance standards. Top wealth managers carefully choose clients who are good candidates for profitable, long-term relationships. Nearly three quarters (73.2%) of wealth managers require a minimum asset size for new clients. Only 38.8 percent of investment generalists do. Likewise, 84.1 percent of wealth managers charge a minimum fee, versus only 33.9 percent of investment generalists who charge a minimum.
  • Client service. Investment generalists typically base their relationships on transactions or events—buying and selling stocks, for example. In sharp contrast, wealth managers cultivate strong bonds with clients, seeking to earn their trust by working in close consultation with them over time. This is evident in the frequency of client contact by the two groups. Wealth managers contact each of their 20 best clients an average of 15.4 times per year. Investment generalists, meanwhile, contact their best clients only 5.6 times a year, on average.
Make the switch

Our empirical research leads to one undeniable conclusion: Making the switch to true wealth management works. In fact, it is the surest path to building a hugely successful advisory practice and creating a better life for your clients, your family and yourself.

To be sure, building a wealth management offering isn’t a quick and easy process. It takes a real commitment. But there can be no doubt that the steps you take toward wealth management today will pay off handsomely for years and decades to come.

Don’t miss this week’s high-impact webinar. Visit this page to register.


About the Author

CEG Worldwide’s founder and CEO, John Bowen has long been known as a leader in the area of adding value to financial services firms. Bowen started his career as an independent broker-dealer representative and then became a fee-based financial advisor. He was ultimately named the CEO of Reinhardt Werba Bowen (RWB), a money management firm that helped other financial advisors raise billions of dollars in assets. In 1998, Bowen became CEO of Assante Capital Management upon the acquisition of RWB by Assante. He left Assante to start CEG Worldwide in 2001, in order to help advisors realize substantial success through the use of CEG Worldwide’s business development systems.

He is the author of many books, including Breaking Through: Building a World-Class Wealth Management Business and The Prudent Investor’s Guide to Beating the Market.