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Wealth Advisory Firms Are Merging, but What’s in It for Clients?


But will the acquiring firms push their advisers to sell clients products that earn higher fees? That’s a hard one to answer, since no firm is going to admit that’s the plan, and because what you get for your money matters, too.

David Barton, vice chairman of Mercer Advisors, has been acquiring smaller advisers — about 26 since 2016, with five more set to close soon — and he now manages $17 billion in assets, up from $8 billion in 2016.

He said Mercer had generally shied away from buying firms that charged high fees, because they probably would not be a good cultural fit. But it’s also tricky when a firm charges lower fees than Mercer.

“If the firm has lower fees, we’ll keep those intact for a period of time,” Mr. Barton said. “But if the clients want access to everything else we offer, they have to go to our fee schedule.” That includes free estate planning and tax preparation done at a reduced rate.

Rick Buoncore, managing partner at MAI Capital Management in Cleveland, tries to solve the fee problem by grouping clients into three buckets: retirement clients who are saving to stop working, estate planning clients who have more than $15 million, and family office clients, whose assets are at least $50 million.

“There is a commonality to it, but the retirement client doesn’t need everything the family office client needs,” he said.

There’s the option, of course, of moving to another firm, but that’s a hassle, especially for wealthier, more complex families.


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