Benefits of Managed Accounts
Constant client contact has enabled advisors to develop more holistic, planning-oriented relationships that are built on advice rather than product recommendations. This, in turn, has often helped advisors capture a larger percentage of walletshare, as they can more easily identify and address their clients’ various needs. However, this ongoing client contact requires a great deal of an advisor’s time. More time spent with clients means less time for other activities such as researching and monitoring clients’ assets.
Many managed account programs have the potential to solve these challenges. They can help free up valuable time for advisors because they are an attractive mechanism through which to build diversified portfolios. Although an increasing number of advisors recognize the value of a fee-based financial planning business, they may resist managed account programs for many reasons. One of the most prevalent is the perception of some advisors that with managed accounts they lose a degree of control, and the client then belongs more to the firm than the advisor.