Adding Value to your Wealth by engaging a Financial Advisor

Studies in recent years have indicated that Financial Advisors add greater value to their client’s wealth than individuals that don’t engage with a Financial Advisor. It is worth referencing a few studies on this topic.


VANGUARD estimated that advisors can add over 3% PER ANNUM in net returns for their clients.

Vanguard cited behavioural coaching +1.5%, spending strategy +1.1% and portfolio rebalancing +0.35% as the largest contributors.  Their study also made the valid point that the most significant opportunities for an advisor to add value do not present themselves every year, hence the importance of an ongoing advice relationship.

RUSSELL INVESTMENTS estimated that advisors can add 4.4% PER ANNUM in net returns.

Russell Investments identified that primarily through a combination of preventing behavioural mistakes, financial planning, tax smart advice and investment portfolio rebalancing, advisors can at 4.4% per annum net of fees to their clients portfolios on average.


The ILC in the UK has been running a multi-year study on this topic.  Here are their most pertinent conclusions:

  • “Taking advice has added GBP £2.5bln to people’s savings and investments”
  • “An ongoing relationship with a financial advisor leads to better financial outcomes, those clients who receive ongoing advice had pension wealth 50% GREATER than those who took one-off advice”
  • “The benefits of advice outweigh any costs associated with it.  Once clients understand this it will no longer be seen as expensive”
  • “The simple fact is those who take advice are likely to be richer in retirement”
University of Montreal

The University of Montreal estimated that the savings of an advised client in Canada will be 2.73 X Larger over a 15 year period versus a non-advised client.  Even over a shorter time frame of 5 years, an advised client will achieve a savings pot 1.58 X the size of a non-advised client.

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