A new report from PriceMetrix says households that have assets of $250,000 or greater are key to growing advisor businesses in the future.
Serving households with less than that amount actually costs advisors money. Revenue from serving these households decreases $270 annually while annual revenues from larger households increase by $1650.
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The report warns advisors to transfer these households to a different service channel or expect to underperform their peers.
Higher net worth households also have more accounts per household. Greater numbers of accounts indicates deeper client-advisor relationships as well as higher wallet share from larger clients.
Fee revenue is also a better predictor of outperformance than revenue from transactions.