Multiplying Millionaires: Growth in Key Industry Demographic Jonathan Bentley Several months ago, The Boston Consulting Group (BCG) released a new report entitled, Global Wealth 2015: Winning the Global Growth Game. Apart from emphasizing the opportunities offered by the growth in the key advisory demographic, “millionaire households,” the report also discusses the opportunity against the backdrop of a more challenging regulatory climate and the growing demands for service and transparency that this group brings. Furthermore, the report mentions that the new “millionaire household” is currently the most profitable and fastest growing segment of the financial advisory market. The report emphasized key client requirement from this segment such as simple and intuitive reporting and transparency from their advisors. This validates the importance of adopting a more efficient, growth oriented cloud-based delivery solution that is offered by InvestCloud. According to the report, there were 2.1 million new millionaires globally in 2014. The main drivers for growth were the investment markets, primarily equities, with an aggregate contribution by bonds and equities of 78% with the other 22% coming from the growth in GDP and savings. Driven largely by last year’s strong equity markets, the share of wealth held by millionaires grew by 16% in 2014 globally. The ultra-wealthy, those with $20 million to $100 million, grew by 34%, making them the fastest growing segment. This growth is great news for wealth managers and advisors despite the competitive nature of the space. According to an investor presentation that BCG delivered in January 2015, Morgan Stanley Wealth Management clients with $10 million or more in assets now account for $746 billion of the firm's more than $2 trillion in assets. This represents a growth of 82%. On the other end of the spectrum, the share of assets held by clients with $100,000 declined by nearly 25%. According to this report and other industry studies, clients that have between $1 and $10 million Asset Under Management are very profitable clients for wealth managers. However, Bruce Holley, a senior partner who focuses on wealth management at BCG said, “[t]hose with about $10 million, however, can be tougher to serve, as they require additional specialists and resources while being able to negotiate lower fees. Firms that target wealthier investors have to segment those clients and be careful to allocate resources.” InvestCloud’s fully integrated applet based platform offers a means for successfully addressing these opportunities in a competitive way. Custom client segmentation and unique, user-based digital experiences are common requests from our highgrowth advisory clients. You can read more about the report as the link below and if you would like more information on InvestCloud and how our how can help you attract more of this
key client demographic with amazing online reporting that can overlay your existing accounting system, click here to request for a demo or visit us at www.investcloud.com. Jonathan Bentley leads InvestCloud’s content development and management division. From helping advisors better craft and deliver their stories to curating customized advisor RSS site feeds, Jonathan’s team is critical to InvestCloud’s bespoke design and site management services. Jonathan was previously founder and CEO of LightPort Inc., which merged, with InvestCloud in 2013. Previously a practicing RIA, Jonathan was involved in developing web portals for more than 500 advisors and money managers while working at LightPort.