Strength in Numbers: Why Team Structures Are Leading the Way

As demands on financial advisors become increasingly more complex, there continues to be rapid growth in financial advisors choosing to work as teams or even in some cases mega teams. In our experience, teaming often allows advisors to bring more expertise to the table for clients, oftentimes creating specialist roles. These specializations may help them be better equipped to offer comprehensive services such as investment management, tax planning, estate planning, insurance, and even concierge-type experiences. 

While clients tend to receive a more holistic-based approach working with advisory teams, we also have seen the benefits of teaming when looking at the bottom line for the advisors themselves. According to a recent study, the median AUM for a team-based practice is $250 million versus $80 million for a sole practitioner. It’s not surprising; one would expect a team AUM of multiple individuals to have a higher AUM but looking at the results on a per advisor basis, the median AUM is $72 million per advisor in a sole practitioner practice vs. $100 million per advisor in a team-based practice. If we also review the average client size, solo practitioners average client AUM is 1.0 million vs. $1.6 million for team-based practices.¹

First Eagle Academy offers an Elite Teams 2.0 program and consulting services designed to help advisors at each stage of team construction, management, and leadership. Please reach out to your First Eagle representative to learn more about how we can tailor our offerings to meet your needs.