How to manage the transition to managed accounts in your advice firm

By Andrew Braun, General Manager Marketing, Netwealth

Managed accounts can offer many benefits for advice firms and their clients, but they also require careful planning and communication to implement successfully. Here are some practical tips and checklists from industry experts to help you navigate the transition, based on the paper ‘Managed accounts: going the distance’ by Netwealth.

Key takeaways

  • A clear vision and strategy are essential for a successful transition
  • Staff training and education are vital to ensure buy-in and competence
  • Communication with existing clients should highlight the benefits and address any concerns
  • Marketing to new clients should showcase your value proposition and differentiation

Managed accounts are becoming increasingly popular among advice firms and their clients, as they offer a range of advantages such as greater transparency, more flexibility, and alignment of interests. However, transitioning to managed accounts is not a straightforward process, and it requires careful planning and execution to ensure a smooth and positive experience for all stakeholders.

In this article, we will share some practical tips and checklists from industry experts who have successfully implemented managed accounts in their advice businesses.

Have a clear vision and strategy

Before you embark on the transition to managed accounts, you need to have a clear vision and strategy for your advice firm. This means defining your target market, value proposition, service offering, pricing model and growth objectives. You also need to articulate how managed accounts fit into your overall advice philosophy and process, and how they will benefit your clients and your business.

As John Burton, Head of Sales at Lonsec, says: “Managed accounts can enable [advice firms] to make a leap in their efficiency and really start to scale and grow their business. But if they don’t have a flag on the hill for the business to head towards, they might not have the commitment to push through to full execution and get the outcomes they are seeking.”

Some of the questions you need to ask yourself include:

  • What are the pain points and opportunities in your current advice model?
  • How will managed accounts address those pain points and opportunities?
  • What type of managed account solution will best suit your needs and preferences? (e.g., private label, external manager, asset allocation, direct equities, etc.)
  • How will you align your fee structure with the value you provide and the cost of delivering the service?
  • How will you measure and demonstrate the success of the transition?

Train and educate your staff

One of the most critical factors for a successful transition to managed accounts is to ensure that your staff are fully trained and educated on the benefits and features of the new solution, and how to use it effectively in their roles. This includes advisers, paraplanners, administrators, compliance officers and any other staff members involved in the advice process.

Staff training and education should cover both the technical and the behavioural aspects of managed accounts, such as:

  • How managed accounts work and what are the key differences from other solutions
  • How to access and use the managed account platform and tools
  • How to explain and position managed accounts to clients and prospects
  • How to incorporate managed accounts into the advice process and documentation
  • How to handle client objections and questions
  • How to monitor and review client portfolios and outcomes.

Staff training and education should be ongoing and interactive, and include various methods like webinars, workshops, case studies, role plays and feedback sessions. You should also provide staff with access to relevant resources and support from the managed account provider, such as product brochures, FAQs, videos, articles, and webinars.

Vincent O’Neill from Stanford Brown says the single biggest focus should be staff communication – particularly if there in concern about advisers feeling disempowered: “Because our value proposition as a business is the client’s whole world, we were able to tell our staff that while investments were an important part of that, they weren’t the only part,” he says.

Communicate with existing clients

Another key factor for a successful transition to managed accounts is to communicate effectively with your existing clients and help them understand the benefits and implications of the change. This communication should start well before the transition and continue throughout the process and include both general and personalised messages.

Some of the best practices for communicating with existing clients include:

  • Segment your client base according to their suitability and readiness for managed accounts. You may want to consider factors such as their investment objectives, risk profile, portfolio size, fee sensitivity and level of engagement.
  • Develop a communication plan and timeline for each segment, outlining the frequency, mode, and content of the communication. You may want to use a combination of channels such as emails, newsletters, phone calls, face-to-face meetings, webinars, and seminars.
  • Explain the benefits of managed accounts in terms of how they can help your clients achieve their goals, rather than focusing on technical features. For example, you may want to highlight how managed accounts can provide greater flexibility, lower costs, better tax outcomes and more transparency.
  • Address any potential objections or concerns your clients may have, such as the impact on their existing investments, the fees involved, the level of oversight and control they will have, and the compliance and regulatory requirements.
  • Provide clear and concise information and documentation to support your communication, such as FAQs, case studies, testimonials, client agreements and disclosure documents.
  • Monitor and measure the effectiveness of your communication and adjust accordingly. You may want to track metrics such as open rates, click-through rates, attendance rates, feedback scores, conversion rates and retention rates.

Paul Cox, Founder and Director of Libero Capital Wealth Management says, “their message focused on how the management of portfolios (their philosophy) had not really changed, but how they’d raised the bar on governance, guardrails and efficiency, which led itself to a better continuity outcome for clients.”

By following these practices, you can increase the likelihood of your clients embracing the change and seeing the value of managed accounts. You can also strengthen your relationship with your clients and position yourself as a trusted and proactive adviser.

If you are interested in learning more about how to transition your clients to managed accounts, you can download the full paper from Netwealth’s website here

Disclaimer: This article has been prepared by Netwealth Investments Limited (Netwealth), ABN 85 090 569 109, AFSL 230975. It contains factual information and general financial product advice only. While all care has been taken in the preparation of this information (using sources believed to be reliable and accurate), no person, including Netwealth, or any other member of the Netwealth group of companies, accepts responsibility for any loss suffered by any person arising from reliance on this information. Any person considering a financial product from Netwealth should obtain the relevant disclosure document, , including Target Market Determination information, at

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