CNBC created a list of advisors who manage money for people with so much wealth they needed a new category. Ultra-high net worth. Because high net worth wasn't doing enough work.
The network calls it the Elite Advisors list. Elite. As if the guy managing your $200 million is fundamentally different from the guy managing your $20 million. He's not. He wears the same Patagonia vest. He sends the same quarterly reports. He rebalances the same allocation you could've gotten from a f*cking Vanguard fund.
But you're ultra-high net worth now. You need someone elite.
Here's what elite means in wealth management: your advisor has other clients who are also ultra-high net worth. That's it. That's the entire value proposition. You're paying 80 basis points so you can tell people at the country club that your advisor also handles money for a guy who sold a payment processing company in 2019.
Most registered investment advisors say they serve wealthy clients. Which is true. Some guy with $2 million in his Schwab account is wealthy. But he's not getting on this list. He's getting a phone call once a quarter and a fruit basket at Christmas. The CNBC list is for people who need to narrow the field. Because when you have $50 million, the hardest part of life is choosing which guy in a Brooks Brothers suit gets to move it from large cap to mid cap based on his gut feeling about Fed policy.
The arms race isn't about performance. It never was. It's about access to the list. It's about the logo on the website. It's about telling your wealth manager you're thinking about going with someone on the CNBC Elite Advisors list and watching him panic like you just asked for the prenup back.
They're not beating the S&P. They're beating each other for your fees.
Photo by Sasun Bughdaryan on Unsplash
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