How Many Clients Should An Advisor Have?
The topic of “What is the Right Number of Clients” for an advisory firm. As some background, over the years I have had lots of conversations from advisors about how many clients they have. When I started at Edward Jones it wasn’t unusual for an advisor to have 500+ clients. Even “small” firms will have 150 or so clients. Heck, the advisor who was one of the people who recruited me into this profession has 1000+ households, which means more than 1,000 individuals. And he ran a one advisor office! A common factor with all these conversations was these advisors bragged about how many clients they had. I used to get caught up in this competition until I realized I was focusing on something not important to me.
When I launched my firm I set a firm number of clients I would take on. Since launch I realized that number, which was under 100, was still too large. Why was it too large? Simply, I couldn’t spend the appropriate amount of time with a client they deserved. I updated my maximum number to 52 clients. Yes, that number is conveniently connected to the weeks in a year. Now, you know I am a rather analytical sort.
Apparently, I seem to be in the minority of advisors who shares how many clients I will take at maximum. To me, this a key questions every potential client should be asking an advisor. Think of it like facebook “friends”, have you ever seen that person with 1,000+ friends? Do they really have 1,000 friends? It must take them forever to get through the grocery store saying hello to that many people. How do they keep track of all of them? Does anyone really want 1,000 friends? Are they actual “friends” or just a collection of names? If you were moving tomorrow how many of the 1,000 would show up if you asked for help? How many would even respond?
I’m not questioning how many clients are too many or just right. That is up to the advisor and their clients. For me, I just know I have a set number based on my service standards and the type of practice I run (quality over quantity). I simply think it is important for every client to understand the advisor’s rationale for how many clients he or she has. So, if you don’t know the answers to these questions, go ahead and ask your advisor now. It is only fair you know and it is an easy question any real financial advisor can answer.