Moving upmarket requires wealth management firms to adopt a broader suite of services, yet the most critical capabilities—such as tax, trust, and estate planning—are also the most costly to scale and the most prone to being outsourced. According to the latest edition of The Cerulli Edge—U.S. Advisor Edition, the firm anticipates that practices capable of properly evaluating the trade-offs between building in-house, buying, or outsourcing will increasingly stand apart as margin pressure intensifies.
The rapid concentration of wealth in the United States over the past decade has heightened demand for more sophisticated wealth management and investment services. High-net-worth (HNW) households—those with more than 5,000,000 dollars in financial assets—are estimated to account for 57% of total U.S. household financial wealth by the end of 2025, up from 43% recorded in 2019.
To capture this expanding opportunity, firms seeking to outperform peers have pivoted their business models toward wealthier clients, a shift that requires overhauling their traditional service delivery frameworks.
“The services that make the biggest difference are also the most operationally burdensome to deliver and, consequently, the most expensive to bring to market,” noted Chayce Horton, associate director. “As a result, nearly all the critical services considered indispensable for moving upmarket are also the most likely to be outsourced by high-net-worth practices.”
On average, high-net-worth advisors report outsourcing between three and four services. Tax planning tops the ranking (55%), followed by trust services (40%), risk management and insurance (39%), and estate and legacy planning (37%).
Cerulli advises firms targeting the upper tier to avoid assuming that an expanded service catalog must be built and managed internally.
“Scale largely dictates where that line falls: large entities can support a deeper bench of internal resources, mid-sized firms tend to formalize integrations or acquire capabilities outright, and those below that tier are best served maintaining their core specialization and partnering or sourcing value from the market,” stated Horton. “As the wealth management industry continues its push upmarket and the ecosystem of independent specialists broadens, firms will need to rigorously assess which capabilities make sense to build internally, acquire, or contract through strategic partnerships,” he concluded.
