If one has $25M to invest and a "traditional" financial advisor charges a combined AUM plus expense ratio fees of 2%, then the annual cost to the client is 500k. For half a million dollars a year, I'd want the advisor's more prominent role to include much more than having a lot of in-person meetings with me. How about doing all of my cooking, cleaning, shopping, errands, chauffering, etc.?I can understand it if you're talking about a "traditional" financial advisor like the type at Merrill Lynch or Morgan Stanley where these people play a more prominent role and usually have a lot of in person meetings. But not a Vanguard PAS rep that's more like a number at a call center. At least my understanding is these people never even get to meet the clients in person.
I cannot see why one would move to follow an adviser. All the adviser does is represent the firm. Our Vanguard rep is perfectly nice but I would not consider switching firms if they were to leave.
They lower their fees at that level, but I get the point and it of course it's ridiculous, but it's indeed out there. What they would say is they offer investment choices retail clients don't have access to and in addition they are "free" because they will outperform for their client if they tried to do it themselves and earn that fee.
I just think it's crazy that a Vanguard PAS rep thought he could build some massive empire poaching UHNW clients this way when he was largely just a guy working at a call center. Vanguard should sue him, imagine how many other people would love access to wealthy clients like this and to sell to them.
Statistics: Posted by illumination — Thu Jul 18, 2024 12:14 pm — Replies 90 — Views 17619