The “Leverage of Size” Principle

A SUCCESSFUL financial services practice is better measured by the asset size of each client’s investment portfolio rather than the total number of clients. It doesn’t take more time to invest $1 million than it takes to invest $100,000, but the fees generated on the million dollars are obviously higher. This discovery of the “leverage of size” came to our top advisors at different times in their careers, but eventually they all came to the same conclusion: Working with fewer, more affluent clients was essential for them to build the multimillion-dollar practices that they all achieved.

There are, however, consequences for working with more affluent individuals. First, the expectations of the quality ...

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