Advisors say outsourcing leads to better investment solutions and work/life balance, AssetMark study finds

Rhea-AI Summary

AssetMark's Impact of Outsourcing Study revealed that 92% of financial advisors outsourcing investment management are satisfied, a significant rise from 83% in 2019. The study surveyed over 750 advisors, highlighting key motivations for outsourcing: enhanced client service, improved work-life balance, and accelerated growth in assets. Advisors reported saving an average of over seven hours weekly due to outsourcing. However, 65% of non-outsourcing advisors expressed concerns over higher fees, while others feared losing control or customization options. AssetMark managed $93.5 billion in assets as of December 31, 2021.

Positive

• 92% of advisors outsourcing investment management are satisfied, rising from 83% in 2019.
• Outsourcing allows advisors to save over seven hours per week for other priorities.
• 98% of advisors report delivering better investment solutions due to outsourcing.
• 95% of advisors affirm better work-life balance from outsourcing.
• 91% of advisors achieved accelerated growth in total assets through outsourcing.

Negative

• 65% of non-outsourcing advisors are concerned about higher fees.
• 48% are worried about losing control over investments.
• 43% believe they cannot customize solutions for unique clients.

AssetMark found that 92% of advisors who outsource investment management were happy with their decision

CONCORD, Calif., March 14, 2022 (GLOBE NEWSWIRE) -- Among advisors who outsource investment management, 92% said they are happy with their decision, up from 83% in 2019, according to a new study from leading wealth management platform AssetMark.

AssetMark’s Impact of Outsourcing Study polled more than 750 financial advisors to uncover the biggest challenges advisors face, and how investment management outsourcing can help them address these issues and drive meaningful change in their businesses.

According to the study, the most common challenges advisors face today are scaling their business for growth and spending the time needed on business-building activities such as financial planning with clients, practice management, and new business development. Thus, it’s not surprising that the ability to serve more clients and focus time on other business activities are two of the top reasons advisors say they are motivated to outsource investment management.

“To achieve scale and growth, advisors need to prioritize their limited time on activities that drive the most value. Investment management can be very time-consuming and doesn’t generate the same value as spending time on clients and business development,” said Matt Matrisian, Chief Channel Officer at AssetMark. “The study found that, on average, advisors who outsource report they save more than seven hours per week that they can repurpose toward other priorities, with the confidence that their clients’ assets are being expertly managed.”

The survey findings underscore how outsourcing drives client, personal, and business benefits to financial advisors:

• Ninety-eight percent said that outsourcing allows them to deliver better investment solutions.
• Ninety-five percent of respondents affirm they have a better work-life balance due to outsourcing.
• Ninety-one percent have achieved accelerated growth in total assets as a result of outsourcing.
  

Among advisors who don’t outsource, top reasons for not doing so are concern over higher fees (65%), concern about loss of control (48%), and the perceived inability to customize solutions for unique customer situations (43%).

“It’s a strategic decision to outsource and advisors need to weigh the pros and cons for their unique practices,” said Matrisian. “Our experience has demonstrated that outsourcing drives transformational value for advisors by providing them with solutions that give them choice, flexibility, and autonomy.”

More information on this study can be found in AssetMark’s whitepaper, The Impact of Outsourcing.

Methodology
The Impact of Outsourcing study was conducted in partnership with 8 Acre Perspective, an independent research firm, and represents the second installment of original research conducted by AssetMark in 2019.

More than 750 financial advisors participated in the study, completing an online survey between September and October 2021. Participants included 581 advisors who outsource investment management and 176 who do not. All participating advisors are owners/principals/partners at firms in the independent broker-dealer, insurance, and independent RIA channels.

All participants have the following characteristics:

• 7+ years tenure as a financial advisor
• Up to $500 million in total assets under management
• At least 30% of total assets is fee-based business
• At least 50% of total assets under management is from individual retail investors

Those who outsource investment management have at least 20% of their assets outsourced to a third party (broker-dealer, model provider, and/or TAMP).

About AssetMark Financial Holdings, Inc.
AssetMark is a leading provider of extensive wealth management and technology solutions that power independent financial advisors and their clients. Through AssetMark, Inc., its investment advisor subsidiary registered with the Securities and Exchange Commission, AssetMark operates a platform that comprises fully integrated technology, personalized and scalable service and curated investment platform solutions designed to make a difference in the lives of advisors and their clients. AssetMark had $93.5 billion in platform assets as of December 31, 2021 and has a history of innovation spanning more than 20 years.

SOURCE: AssetMark, Inc.

Media Contact:
Alaina Kleinman
Director, Communications & Public Relations, AssetMark, Inc.
alaina.kleinman@assetmark.com

FAQ

What did the AssetMark study reveal about advisor satisfaction?

The study found that 92% of advisors outsourcing investment management are satisfied, an increase from 83% in 2019.

How much time do advisors save by outsourcing investment management?

Advisors reported saving an average of over seven hours per week by outsourcing investment management.

What are the main benefits of outsourcing for financial advisors?

Benefits include better investment solutions, improved work-life balance, and accelerated growth in total assets.

What concerns do non-outsourcing advisors have?

Concerns include higher fees (65%), loss of control (48%), and inability to customize solutions (43%).

How many advisors participated in AssetMark's study?

The study included over 750 financial advisors.

What is the total assets managed by AssetMark as of December 31, 2021?

AssetMark managed $93.5 billion in assets.