Stop “Advisor Value” Studies

A few months ago, Russell Investments released the 13th edition of their “Value of an Advisor” study. It’s listed as content “for financial professionals only” so I can’t link to it directly, but if you give it a Google search you’ll find the whole thing. For now, at least.

Russell estimates that in 2026 the potential value of a financial advisor is 4.92%. A number much higher than Vanguard’s Advisor Alpha estimate of 3% and Morningstar’s Advisor Gamma of 1.82%.

Where does that 4.92% value come from according to Russell? From asset allocation, behavioural coaching, customized family wealth planning, and tax-smart planning and investing.

Asset allocation is a fancy way of saying, “your investments are aligned with your tolerance for risk/volatility, they are diversified, and you’re not needlessly sitting on too much cash.”

Behavioural coaching is what I write about the most: don’t give into fear and fear of missing out and try to be as rational as you can (but within reason).

Customized family wealth planning is another way to say financial planning.

And tax-smart planning and investing (as opposed to tax-dumb planning and investing) means you’re considering and then minimizing the taxable implications of everything you do.

Russell says that kind of advice is worth almost 5%. I think that’s obscene and these “Advisor Value” studies need to stop.

I am not aware of any profession as insecure as wealth management. Accountants don’t send you their invoice along with a list titled “all the value we provided.” Lawyers don’t go on the defensive before they send you the bill (they are lawyers, though, so I’m sure they’d love to). And cosmetic surgeons don’t lecture you about the per dollar value they just provided when you come out of anaesthesia.

But for some reason wealth management at large needs these reports to justify their fees. And I think it’s entirely because the old-school “make the sale and move on” advisors from the 80s, 90s, and 2000s are still running the show.

When I was trained in 2011, I was told to wait for the objection to the sales pitch—and I was promised there’d be an objection—and then persuade or scare (ugh) the client into submission until they were ready to sign up. This old-school sales culture needs to end.

These “advisor value” studies aren’t a new sales tactic. They’re the same old “persuade or scare you into submission” tactic repackaged as justification: “Here’s why you’re paying us.”

Wealth advisors can only help people who want to be helped. And people who want to be helped will decide for themselves if the person they’re sitting across from is worth the fee, whether the advisor justifies it or not.