Why We Believe ‘Assets Under Advice’ Matters More Than ‘Assets Under Management’

For decades, Assets Under Management (AUM) has been the marquee metric of wealth firms: a single number representing the total market value of client assets that a firm actively manages, allocates, and rebalances on behalf of clients. By that definition, more AUM equates to stronger revenue potential, larger market presence, and, ostensibly, better client outcomes. But in a world of fragmented financial lives, that traditional focus is becoming less aligned with where real client value actually resides.

At Alphanso, we think the future of advice isn’t centered on how much of a client’s portfolio we control. It’s centered on how much of a client’s financial reality we genuinely understand and influence. That’s what Assets Under Advice (AUA) captures and why, for the modern investor, it matters more than AUM.

1. The modern investor’s balance sheet is fragmented and complex

A typical investor’s financial life today isn’t limited to a handful of brokerage accounts. It spans:

• Multiple 401(k)s across previous employers
• Career equity like RSUs and ESPPs
• Startup equity and private holdings
• Mortgage balances and debts
• Cash across banks
• Real estate and illiquid exposures

This level of fragmentation means a client’s highest-impact financial decisions are often made outside of the accounts a firm directly manages.

Traditional AUM only counts what’s under your direct control. AUA counts everything you advise on, even if the client retains custody and decision-making authority. That distinction matters because it aligns the fiduciary relationship with the actual scope of influence the advisor has on a client’s long-term outcomes.

2. AUM reflects control - AUA reflects influence

The financial industry likes AUM because it maps neatly to revenue: manage more assets, charge a percentage fee, and scale earnings. That model historically made sense when most assets were consolidated in a single custodian.

But control isn’t the same as influence:

• AUM advisors make discretionary decisions - they trade, rebalance, and allocate.
• AUA advisors guide decisions - they advise on allocation, planning, and strategic trade-offs across all holdings a client has.

AUA gives a more accurate picture of how deeply an advisor understands and impacts a client’s entire financial life. Your advisor could manage $2 million (AUM) for a client but only be meaningfully advising on 25% of client net worth. Meanwhile, another advisor might advise on $8 million of client net worth, even if only $2 million is managed directly. The latter has deeper strategic engagement and an AUA metric that reflects that.

3. Client outcomes don’t live behind custodial boundaries

If the goal of financial advice is to improve client outcomes, whether that’s maximizing after-tax wealth, achieving retirement certainty, or managing concentrated equity risk, then seeing the full picture is indispensable.

Consider a household with:

• $400K in a rollover IRA
• $300K across taxable accounts
• $500K in RSUs that vest over time
• $1.2 million in a 401(k) at a prior employer

An advisor who only manages the rollover and taxable accounts (a total of $700K AUM) has an incomplete view of this household’s risk exposures, tax planning opportunities, and retirement glidepath. But an advisor with $2.4M of AUA sees the interconnected whole and can offer materially better, more anticipatory advice.

This difference isn’t academic. It’s the difference between reactive planning and strategic, lifetime-oriented planning.

4. Advice should scale with visibility, not custody

The digital age has changed what’s possible:

• Secure account linking allows advisors to see all assets without requiring transfer.
• Granular permissions mean clients keep control while sharing actionable data.
• AI-driven insights surface risks and opportunities across previously siloed accounts.

These tech advances mean wealth advice doesn’t need to be gated by custody to be effective. Instead, visibility becomes the true north star. When the advisor’s insights encompass all assets, that creates a more robust advisory relationship and a more accurate measure of impact.

5. Aligning fee structures to value, not control

AUM-based fees are predictable, but they also create misaligned incentives. Clients might be encouraged to transfer assets simply to fit a billing model. At Alphanso, we’ve moved towards subscription-forward pricing precisely because it aligns with holistic outcomes, not custodial control. 

An AUA mindset supports this transition because:

• It rewards advisory scope over asset capture
• It focuses on client goals rather than asset aggregation
• It democratizes access to high-quality advice beyond ultra-wealthy cohorts

Ultimately, value should come from better decisions, not bigger balance sheets.

Conclusion: Advisors should measure what matters

AUM will remain a useful figure for understanding discretionary responsibilities. But if the mission is to guide individuals toward better financial outcomes across their entire net worth, then Assets Under Advice is a more meaningful, strategic metric.

AUA reflects influence, trust, and alignment with the investor’s real financial life. It scales with the complexity of modern wealth and rewards advisors for the quality of guidance they provide, not just the quantity of assets they manage.

At Alphanso, our vision of the future of wealth lies not in custody, but in clarity in seeing every asset that matters so that every decision can be better informed and more deeply connected to a client’s goals.‍

Have a request, feedback or want to brainstorm? Let’s chat in a 1:1 session, would love to learn your perspective.