The rationalization to increase productivity over the past two decades has broadly shifted wealth manager focus to the segment of clients with $1 million-plus in investable assets, a model trumpeted in the large wirehouse channel. In tandem, a growing channel of independent registered investment advisors has championed the use of tech to scale, seeking to expand their book across wealth segments. Here, flexible and personalized fintech solutions have shown increasing promise. These applications are embedded across key points of investor engagement, including onboarding, investment selection, disclosure, portfolio construction, and financial planning.
Core mass affluent investors (those with $500,000 to $1 million in investable assets) are a central component of the advisor’s book. The segment generally represents a best fit for the median assets under management of the advisory client, which largely spans three generations: Millennials, Generation X, and Baby Boomers. However, Javelin Strategy & Research investor survey data indicates that the age distribution of the core mass affluent is concentrated on two generational tails: Millennials (44%) and Boomers (35%). This portends the growing importance of the next-gen investor segment and helps to redefine engagement strategies. Importantly, Millennials in this wealth cohort are more likely to switch providers if they’re not given the same level of engagement as wealthier clients.
Key questions discussed in this report:
- Who are core mass affluent investors?
- What are their digital and human engagement needs?
- How can wealth managers better serve this segment?
AssetMark, Envestnet, Envestnet MoneyGuide, Morningstar ByAllAccounts, Nitrogen, Orion Advisor Technology, Pershing X Albridge, Plaid, StratiFi, Tolerisk
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