Brokers and the Affluent
Wall Street has figured out that the best way to make money is to go after people who have a lot of it. Wall Street brokerage houses figure to beef up sagging profit margins by targeting the mega-wealthy, so if your net worth is in the $5-million-plus range, you're in some broker's crosshairs. What they hope to do is charge you for advisory services, like helping you with estate planning and donations to charity, in addition to pocketing the traditional commissions on securities trades. The competition for wealthy clients is stiff and the market is shrinking as fewer of the super-rich turn to brokers for advicejust 30% last year compared with 37% in 2001. Among the contestants are UBS Group, Merrill Lynch, and Smith Barney, all of which have opened special investment centers catering to wealthy clients.