Winning clients’ held-away assets without being pushy

Wealth managers are stepping up efforts to move clients’ held-away assets into their programs by emphasizing planning, trust and timing. Firms say they focus on advice and wait for life events that prompt clients to rethink their finances.

Merrill’s chief operating officer Patricio Diaz pointed to trust and inertia as common reasons clients keep accounts elsewhere. He told advisors many clients avoid transfers because they fear judgment or do not want the hassle. “Focus on the advice first, you build trust, and then you deliver good financial planning, good advice, good outcomes. Then the assets follow,” Diaz said, adding that transfers often occur after the sale of a business, retirement or a large inheritance.

Bank of America executives have highlighted the potential scale. Eric Schimpf, co-head of Merrill Wealth Management, estimated the bank has about 9.5 million customers who are not Merrill clients and that those customers hold roughly $10 trillion in investable assets. He calculated that capturing 1% of that pool would add about $100 billion in assets under management.

Industry data indicate many wealthy investors split assets among several providers. A recent global wealth report found 19% of high-net-worth individuals worked with a single firm, down from nearly 40% in 2019. The report linked the shift to demand for services such as alternative investments, tax strategies and digital asset management that a single firm may not provide.

Large firms are pitching the range of services available when accounts are consolidated: tax management, estate and trust planning, securities-backed lending and access to private equity and credit. Diaz described a pattern in which a client seeking personal wealth advice learns the firm can also address business financing or other needs, and some assets follow.

Workplace channels are another route to held-away balances. Morgan Stanley’s workplace unit has estimated clients of corporate retirement plans hold trillions of dollars outside the firm. Morgan Stanley CEO Ted Pick has pointed to that pool as an opportunity. Regional firms are also expanding workplace offerings. Edward Jones recently added retirement-plan options from major managers to its business benefits lineup. Edward Jones adviser Norm Cauntay said a first encounter often begins with a 401(k) and that plan participation can lead to broader discussions about other holdings. “It would almost be like going to your doctor and talking about one symptom and not talking about everything else,” Cauntay observed.

Advisors describe a cautious approach to persuasion. Too much emphasis on moving money can prompt resistance, so firms recommend delivering planning and waiting until a client’s situation becomes more complex. Scott Bishop of Presidio Wealth Partners said his firm sometimes requires disclosure of outside holdings as a condition of advising, and that it may charge an assets-under-advisement fee for guidance on external brokerage accounts or a flat annual planning fee to monitor outside retirement plans.

Practical steps used by advisers include searching for forgotten 401(k) accounts from prior employers and offering fee arrangements that cover oversight of outside accounts. Firms state that coordinated tax planning, retirement sequencing and estate work can be more effective when advisers see all holdings.

Wealth managers characterize patient relationship-building, consistent planning and attention to life events as their main approaches to winning held-away assets.