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- Wealth managers told us a human touch when it comes to special requests helps lure and keep clients. That can help justify their steady fees at a time when big and small firms are racing to add headcount catering to the wealthy.
- The pool of high- and ultra-high net worth assets in the US has been pegged at more than $20 trillion. But competition is fierce, as big and small firms are vying to cater to those clients’ needs. And the next generation of wealth is growing up more accustomed to digital solutions.
- Business Insider talked with five wealth management insiders about the memorable client requests they’ve fielded over the years — from assisting in a personal butler search to difficult situations like figuring out how to manage risks after an accident.
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High-touch. A holistic approach. Full-service. Wealth managers are quick to emphasize that what they can offer rich clients goes far beyond portfolio allocation and estate planning.
So what do those buzzwords mean in practice? Insiders told us about being called on to find their client a butler, locate a cowboy, or prepare children for the day they have their own board seat.
High- and ultra-high-net-worth households make up roughly $21.3 trillion, or some 44%, of the total investable assets in the United States, according to the most recent data available from research firm Cerulli Associates. (High-net-worth generally starts at $1 million, and the low end of ultra-high around $20 million – $30 millioon.)
Many we’ve talked to say the rise of roboadvisers aimed at so-called mass affluent investors doesn’t threaten their core client base. But they are still increasingly aware of the need to show how humans can stand out, and a full-service approach can help justify their steady fees at a time when big and small firms are racing to add headcount catering to the wealthy.
The concierge approach can also help endear managers to their clients’ kids and grandkids, who are set to inherit big money: Cerulli found that $68 trillion is set to transfer in the next 25 years, largely from baby boomers to digital-native heirs.
And recent survey by Cerulli and the Investment & Wealth Institute, an industry association aimed at investment professionals, showed many of the association’s adviser members are changing their services to provide "holistic advice," and "transforming" accordingly.
Business Insider asked wealth management executives about their most notable client requests. As advisers need to adhere to client-adviser privacy practices, they did not disclose clients’ names in interviews.
Advisers call also be called upon to help wealthy families with weighty matters.
"So often, we’re the first call when something traumatic happens," Adrienne Penta, a Boston-based managing director at Brown Brothers Harriman, said about the connections that people working in wealth management can form with clients. "We also have a close relationship with their financial life and how they manage risk."
Anthony DeChellis, CEO of Boston Private: ‘Anybody can get someone sporting tickets, or concert tickets, and that stuff’s all fun and good. But that’s not a distinguishing feature in my mind’
Courtesy of Cookson Adventures
When a Boston Private wealth client told the firm’s CEO, Anthony DeChellis, earlier this year that he needed a cowboy, he wasn’t using an obscure money-managing term. He needed someone to actually herd his cows.
"He kind of smiled when he said it, and I didn’t know exactly what he meant at the moment, so I said, ‘A cowboy?’" DeChellis told Business Insider in a recent interview.
"And he said, ‘Yeah, I bought this ranch my kids didn’t want me to buy, and my cowboy quit, and I got 400 cows that are going to die, so I’ve got to find a cowboy.’"
DeChellis went to Bill Woodson, who heads up the firm’s family office services, for help.
"Sure enough, through Bill’s experience, he had encountered a couple of groups that managed some very substantial ranches," DeChellis said, and they offered the client some suggestions and connections in finding a qualified person.
"I ended up going out to California in the following three weeks, and the client insisted on driving me out to the ranch so I could see his 400 cows," he said. "And I went. I didn’t meet all 400 individually, but I got to see a pretty good size of the herd."
To DeChellis, who joined Boston Private last year, the lighthearted story underscores wealth professional’s more fundamental responsibility to their clients.
"Anybody can get someone sporting tickets, or concert tickets, and that stuff’s all fun and good. But that’s not a distinguishing feature in my mind," he said. "What’s a distinguishing feature is when the client has a genuine sense that you can help them sort out a problem that is not common, not being seen every day, and probably does get dealt with by those families who have really complicated wealth."
Adrienne Penta, managing director at Brown Brothers Harriman: ‘We ran a process and a search to find a classically trained butler’
Olivia Harris / REUTERS
A Brown Brothers Harriman client who lives in New York City was looking for a butler.
"We ran a process and a search to find a classically trained butler," managing director Adrienne Penta said in a recent interview, recalling how she went to a household staffing agency to assist with the search, the onboarding process, and the payroll.
The firm’s client had a large home in the city and liked to travel; she wanted someone who would travel with her, assist with packing, and ensure things ran smoothly when she checks into hotels abroad.
Penta got a taste of clients’ wide-ranging requests when she practiced trust and estate law at a Boston-based firm before joining Brown Brothers Harriman. There, a client had asked her team to help him set up a summer camp.
And while at Brown Brothers Harriman, Penta had another noteworthy experience; one of the firm’s clients with a large private foundation in New England wanted her daughter to help run the organization.
"So, she came to the office for a couple of days, and we ran, basically, a private-foundation 101-type of boot camp to understand all of the bells and whistles," Penta said.
Stephanie Luedke, head of private wealth management at Neuberger Berman: ‘Classroom to boardroom’
Getty Images/Andreas Rentz
To Stephanie Luedke, Neuberger Berman’s head of private wealth management, helping clients solve complex wealth-related needs is critical. That includes key areas like trust and estate, tax planning, and philanthropy.
Sure, wealth managers can tout "holistic" and "full-service" solutions, but they have to deliver, too.
"That’s what advisers endeavor to do for clients, but it’s an extraordinarily broad statement," she said, adding that wealth managers can become a "true confidant" for clients.
Part of that can be helping educate young family members and facilitating conversations with clients’ children about their family wealth, said Luedke, who joined Neuberger Berman earlier this summer. She was previously Citi Private Bank’s global head of Citi Investment Management.
She said her firm holds "classroom to boardroom" educational series for families who would like their kids to learn about being on a company board. It can also help out in other areas like preparing clients’ children for an interview or educating them about the financial markets.
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