Russ Thornton, a fee-only financial planner in Atlanta, wrote an interesting article about the number of clients financial advisors should have. I've summarized his thoughts below:
Dunbar’s number is a research-based number of “stable social relationships” each one of us can maintain over time. Robin Dunbar's studies suggest the number is somewhere between 100 and 230, but the most often used figure is 150.
Dunbar’s number is a research-based number of “stable social relationships” each one of us can maintain over time. Robin Dunbar's studies suggest the number is somewhere between 100 and 230, but the most often used figure is 150.
I’m not going to declare that Dunbar’s number is an accurate measurement of your personal relationship limit, but I think it's interesting to consider the relevance of this number as it relates to financial advisors.
According to research from CEG Worldwide, the typical investment advisor serves 269.3 clients. Of course, this number is in addition to any personal relationships the advisor might have. If there is any truth to the notion of Dunbar’s number, and the average advisor has 269 clients, how much of a relationship can you actually have with your advisor if you are “competing” with 268 other clients for his time and attention?
If you work with an advisor, I suggest you ask them how many clients they have. It might not reveal anything, but then again, maybe it will.
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