Ameriprise Puts Managed Account Programs Under One Roof
Ameriprise Financial has rolled out a streamlined managed account system that unites various programs under one umbrella, FA-IQ sister publication FundFire writes.
The company’s advisors will be able to access some of Ameriprise’s managed account programs through one system, in some cases without having to sign additional documents, according to a Form ADV filed by Ameriprise this month and cited by FundFire. The move is meant to bring “more flexibility and efficiency” for advisors across their various relationships with clients when it comes to investment management, an Ameriprise spokesperson tells the publication in an email. Currently, there are three programs available through the streamlined account system, covering mutual funds, ETFs and annuities, FundFire writes. But the company is already piloting the addition of four more programs to the new system, including its separately managed account strategies and more, according to an Ameriprise brochure cited by the publication.
As part of the move, Ameriprise is also changing its pricing structure, FundFire writes. While currently Ameriprise clients pay an asset-based fee for managed accounts, the new framework includes separate fees for advisory, manager and platform services as well as an Ameriprise Financial Planning Service fee, according to the publication. The maximum advisory fee is capped at 2% and the maximum asset-based fee is capped at 3%, while the minimum asset-based fee will be $300, FundFire writes. Manager fees will go up to 0.80% while platform fees will only cover extra costs associated with investment strategy and due diligence, trading, reporting, advisory training and other operational and support functions, according to the publication.
Ameriprise’s new program is similar to what wirehouses like Merrill Lynch have rolled out, FundFire writes. In 2013, Merrill Lynch launched a single investment advisory platform dubbed Merrill Lynch One, which now has $900 billion, according to the publication.
“The movement to one platform has been in the cards for years and it’s more of an operational issue than a strategy issue,” Scott Smith, director at Cerulli Associates, tells FundFire. He also says that firms like Ameriprise and Merrill Lynch have the back-office capacity to roll out such platforms, according to the publication.
Meanwhile, the new platform will help Ameriprise’s recruiting efforts, Mark Elzweig, head of advisor recruiting firm Mark Elzweig Company, tells FundFire.
“It makes it easier for an advisor to do business and simplifies a client’s financial life,” he tells the publication. “Also, since it offers a type of relationship pricing for one fee, you are getting both asset management and financial planning [services] and [it] encourages clients to centralize their accounts with Ameriprise advisors.”