Advisory Teams Report Higher Growth, Assets Than Solo Practices

Wealth management team-based practices have “numerous advantages” over solo practices, with average client assets larger for teams (approximately $2.3 million) than solo advisers (approximately $980,000), according to a Cerulli Associates survey.

Wealth management team-based practices also reported more than three times the average of solo practices’ AUM—an average of $330 million in assets under management, according to the Cerulli Report – U.S. Advisor Metrics, which surveyed more than 2,000 wealth management advisers. Measuring AUM at year-end 2024, solo practices reported an average of $95 billion in AUM. Solo practices also reported a lower average of $8 billion in annual organic growth, compared with team-based practices’ average growth of $20.3 billion.

More than half (51%) of all surveyed advisers reported operating in teams, including nearly two-thirds (64%) of respondents in wirehouse and hybrid registered investment advisers.

Practice Management

Growing practices had some downsides, as Cerulli found that 63% of all surveyed management considered it a major challenge to train junior advisers and recruit established advisers. One-quarter of responding advisers said they had challenges when managing conflict between staff.

Nevertheless, team-based practices had the upper hand in many categories. They reported higher percentages of junior advisers (46%) and succession plans in place (79%) than solo practices, where only 15% of staff were junior advisers and 66% had succession plans. Team-based practices also had more specialized staff (37%) than solo practices (8%).

“Adviser practices that incorporate at least one planning specialist or paraplanner will be better positioned for expanding their financial planning capabilities,” said Andrew Blake, Cerulli’s associate director of wealth management, in a statement. “Large multi-adviser practices are expected to become more common as consolidation continues and as pooling resources becomes increasingly feasible.”

That consolidation, amid record mergers and acquisitions, led to the average surveyed adviser’s AUM growing to $125 million, up 12.2% from the previous year’s average of $111.4 million. Among respondents, 55% of advisers—including three-quarters of advisers aged 45 to 54—said they were interested in acquiring a practice.

The report stated that effective, strong teams reported having “collaborative leadership, consistent communication, and a shared vision among members to realize synergies.”