Schwab family office head preps RIAs for landing big fish

Financial advisors are playing a game of catch-up in trying to get their books of business back to early 2008 levels.

One tactic they are employing is to go after a handful of big clients with $20 million rather than trying to win dozens of smaller ones and that’s where Janelle Sallenave comes in.

The head of family office services for Schwab Advisor Services is making it easier for advisors to learn how to make the right investments upfront to land the big ones.

But for now she’s in San Diego giving a crash course to advisors at IMPACT on how to price family office services.

“The multi-office firms will struggle if they have customized pricing for every family,” she says. “They need to [standardize].”

Sallenave recommends a two-prong approach. Some fees should be set based on on asset levels and another set of fees should be levied “a la carte”. She means that advisors should specify what clients are paying for extra services like the oversight of multiple homes or the paying of client bills.

The importance of breaking down the bill is to get rewarded for the work and also to be sure that clients understand the value that they are receiving.

But won’t the client get frustrated if its advisory bill looks like its dry cleaning ticket?

“It’s never about the fee” for clients, she says. “Clients will gladly pay. I rarely, rarely see where a client takes something on their own” in order to avoid paying a service fee.

Sallenave says that two factors are spurring demand from advisors for greater knowledge of how to serve the ultra-affluent.

“The client with $1 million [has a liquidity event and] has $20,$30, $40 million and that wealth manager is struggling to make the transition,” she says.

The next step is more proactive.

“Now they say: I want to take another [big client] because I figured out how to do it,” Sallenave says.