Oct 4 Older men may be the stereotypical U.S.
wealth managers, but they are getting a run for the money from
their younger and female counterparts, according to a survey
released on Thursday by Fidelity Investments.
On average, advisers under age 48 manage 16 percent more in
client assets than those who are older, and women manage 5
percent more than male advisers, according to the survey, which
was conducted in March.
To be sure, Fidelity surveyed just 1,200 advisers and
brokers at broker-dealers, banks, wirehouses, insurers and
registered investment advisors - a small fraction of a group
that research firm Cerulli Associates estimates at more than
But with third-party research firms verifying that this was
a representative sample, the results could be a nascent sign of
change in the wealth management industry, said Fidelity, which
has done this survey six times since 2005.
"This is the first year that the face of the new adviser
really popped out," said Alexandra Taussig, a senior vice
president of Fidelity clearing division National Financial.
Despite managing more money on average, these groups are
taking home less of it than older, male advisers. Taussig said
this could mean that younger advisers and women need to get
better at negotiating their fees and pay structures.
For years, conventional wisdom has said that the adviser
force is aging and is not getting replenished because new
recruits have trouble building a book of business and decide to
leave the industry.
But in its latest survey, Fidelity found that the majority
of advisers were Generation X/Y, which are defined as between
the ages of 21 and 47. Advisers in this younger group are
managing $59 million in client assets on average, versus $51
million for their older counterparts.
Matt Reiner, the 26-year-old chief investment officer at
Atlanta-based Capital Investment Advisors, said younger advisers
could be succeeding because of their ability to relate to
clients still shaken by the financial crisis of 2008.
Because Gen X and Gen Y advisers have spent the bulk of
their careers in tumultous times, Reiner believes they are more
strategic and conservative than older advisers, who tend to have
a longer and more optimistic outlook.
Younger advisers are also comfortable with technology,
making them more efficient, Reiner said. If not for him and his
younger coworkers, he said, the 15-person firm, which manages $1
billion in client assets, would still be analyzing investments
with pen and paper.
Reiner's 59-year-old boss and father, Michael Reiner says
there was a time when clients picked an adviser by "counting the
gray hairs," but more people have grown to appreciate younger
advisers, who are often more focused on research and willing to
adjust their strategies with the markets.
However, Reiner, who founded Capital Investment in 1996, is
not writing himself off, saying clients still like seeing a firm
headed by someone with a long tenure.
Merrill Lynch Wealth Management's Cynthia Hewitt, who has
been on the Barron's list of Top 100 Women Advisors for seven
years, says she is not surprised to hear that women have more
client assets than men on average.
Generally speaking, women tend to be more approachable and
more vigilant about servicing, said Hewitt, a founder of the
Hart Group, a Wilmington, Delaware-based Merrill team that
manages $1 billion in client assets.
Fidelity found that women, who on average managed $58
million in client assets versus $55 million for men, are also
more likely to discuss financial issues outside of traditional
investments - like budgeting, charitable giving, healthcare and
Still, women earn 5 percent less than men, and make up just
13 percent of the overall financial adviser population,
Fidelity's survey said. And the annual Barron's Top 100 Advisor
rankings, a closely watched list in the industry, only had about
a half-dozen women on it this year.