Data & Research June 13, 2007

Some Wealthiest Professionals Rely on Advisers

About one-fifth (21%) Ultra High Net Worth (UHNW) professionals consider themselves 'adviser dependent.'
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The nation’s wealthiest doctors, lawyers and other professionals are nearly twice as dependent upon financial advisers as Ultra High Net Worth individuals (those with a net worth of $5 million or more, not including primary residence) in other occupations, only 12% of who consider themselves dependent, according to research by the Spectrem Group.
“For the financial services industry, there is a great opportunity to make inroads with wealthy professionals, who obviously value similar professional qualities in their advisers,” said Catherine S. McBreen, Managing Director of Spectrem Group.
Those in this income group are most likely to use full service brokers, with heavier usage on the part of other occupations (32%) than professionals (30%). Wealthy professionals are more interested than the other occupations in accountants (12% vs. 6%) and independent financial planners (9% vs. 8%).
A higher percentage (26%) of UHNW professionals use independent investment advisers as their primary financial advisers than do UHNW individuals in other occupations (11%), the new Spectrem Perspective report, “UHNW: Understanding Unique Financial Needs of Doctors, Lawyers and Other Professionals” found.
“Professionals clearly place a high value on education and expertise, so it’s logical that the wealthiest doctors, lawyers, accountants and dentists would rely more heavily upon financial advisers to handle their investment decisions than individuals in other occupations worth $5 million or more. These professionals also gravitate more toward independent sources of advice, including independent investment advisers, accountants and independent financial planners,’ McBreen said.
Those interested in purchasing “UHNW: Understanding Unique Financial Needs of Doctors, Lawyers and Other Professionals” can contact Spectrem Group at 641 W. Lake Street, Suite 402, Chicago, IL 60661, (312) 382-8284 (http://www.spectrem.com).
In Practice June 13, 2007

Census Report Could Clue Advisers in to Opportunities

A report released by the U.S. Census Bureau on Wednesday provides information on new businesses and payroll that may aid advisers in finding new clients.
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The report, County Business Patterns: 2005, provides data by county on the number of establishments, number of employees, and quarterly and annual payroll for the nation’s 7.5 million businesses with employees, according to a Census Bureau news release.
According to the census data, of the 50 counties with the most business locations in 2005, those showing significant growth in the number of businesses with paid employees were Riverside County, California (5.9%); Orange County, Florida (5.9%); Clark County, Nevada (5.6%); Maricopa County, Arizona (5.1%); and Palm Beach County, Florida (4%).
Among the counties with the most employees, New York County (Manhattan), New York, had the highest average annual payroll per employee at $85,469, according to the news release. Santa Clara, California, was second at $72,888, followed by San Francisco ($66,366); Fairfield, Connecticut, ($64,238); and Suffolk, Massachusetts, ($64,067).
Data from the report can be provided at the state, county, metropolitan statistical area and five-digit ZIP code levels. The metropolitan and ZIP code data will be released later this year.
The report excludes information on self-employed people, employees of private households, railroad employees, agricultural production workers and most government employees, the news release said.

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