Don't ignore family when courting high-net-worth clients

In the never-ending search for high-net-worth clients and more assets, wealth managers might want to keep it in the family. There's plenty of growth potential when working with children of wealthy clients, which allows advisers to prepare to keep these young investors when they eventually inherit assets. Advisers don't have to break their own account minimum rules in order to tap into that up-and-coming generation of investors. Rather, they can aggregate assets across generations of a family to ensure that the minimum is met. “We aggregate up and down linearly, parent to child, and we do that to reach the minimum,” said Chris Cordaro, chief executive of RegentAtlantic Capital LLC and a panelist on last Tuesday's InvestmentNews webcast, “Attracting High-Net-Worth Clients.” “A child starting out won't reach the minimum, and most of their wealth will be gifts from the parent anyway,” said Mr. Cordaro whose firm requires a $1 million asset minimum. Most high-net-worth clients want to ensure that the adviser can care for the rest of the family, and they place a premium on that. “Many investors don't see their advisers asking [to discuss their children],” said webcast panelist Catherine McBreen, president of Spectrem Group's Millionaire Corner. “Most of these [heirs] don't know who to call other than the attorney. The attorney acts as a gatekeeper for many of these individuals, but most of them should have had a relationship with their parents' adviser.” Aggregating assets across generations can also pave the way for the most comprehensive planning, according to panelist Murray Stoltz, president of Manchester Capital Management LLC. His firm has a $10 million asset minimum for clients but will aggregate a family's assets to treat multiple generations. “We are often integrating the estate plan, the legacy and the future,” he said. “Working on that $300,000 or $400,000 portfolio with the son or daughter in their 20s or 30s is part of the plan, and we're hired to make sure that we can do that face-to-face work with that generation.”