A client leaves a meeting with her advisor feeling good, maybe even relieved. The advisor was attentive, the numbers made sense and her questions were answered. Everything seemed fine.
Years later, that same client discovers a tax issue that should have been caught or realizes an old beneficiary designation was never updated after her divorce. Or she finds out that a missing buy-sell agreement is about to complicate her company’s acquisition. The client doesn’t come back to the firm to flag the miss. She just doesn’t come back.
Ask clients what they actually want from their advisor and the answer is probably “thoroughness.” According to McKinsey, the share of affluent investors who want holistic advice — someone looking across investments, taxes, insurance and estate planning together — grew from 29% in 2018 to 52% in 2023. Clients want someone connecting dots they didn’t know were there and anticipating questions they didn’t know to ask.
The trouble is, advisors can only act on what they think to consider, and the thinking varies enormously from advisor to advisor, based on experience, specialty and how many similar situations they’ve personally seen before.
An Uneven System
It’s an intrinsic problem that can’t be fixed by effort alone. The industry’s answer is typically repetition: Put advisors in front of enough client situations, and over time they eventually develop the instinct to handle complexity and read situations correctly. Firms have tried this through training programs, mentorship and structured review processes.
These are good investments, but they build skill slowly. You can teach a new advisor what questions to ask in a business sale, but the instinct to know which answer should trigger three more questions tends to come from having sat across from enough business owners to recognize patterns.
That kind of experience is usually concentrated in a small group of senior people at any given firm. Newer advisors are smart and well-meaning, but they haven’t yet seen enough client situations to know what they don’t know. This is an advice gap, and it can take years to close.
This is an advice gap, and it can take years to close.
The client sitting across from a newer advisor today is getting a different level of scrutiny than the client sitting across from the firm’s most experienced person. And firms are about to lose a lot of that senior experience. Last year, Cerulli projected that more than a third of advisors, controlling 41% of industry assets, would retire within the next decade.
Advisors tend to think of the advice gap as a quality issue. It’s also arguably a bigger business development issue. Referrals are the lifeblood of most practices, and they come from clients who feel fully understood, not just adequately served. A client who senses their advisor caught something they wouldn’t have caught themselves tells their friends. A client who later learns something was missed does not stay, and often quietly exits before the next review meeting.
The cost of an advice gap shows up as fewer referrals, a client who stops returning calls, or an AUM number that should have grown faster than it did. Firms chasing growth through marketing and recruiting are often trying to refill a bucket with a hole in the bottom.
These are commercial stakes. But when a material planning issue goes undetected, a client is also underserved.
Infrastructure Rather Than Intuition
Firms are starting to question whether the reasoning process itself can be made available as infrastructure. Until recently, the answer was no. Prior technology was built for storing knowledge; applying it requires different capabilities. What’s changed is that large language models (LLMs) can actually work across complexity.
They can hold a client’s full situation in mind, recognize patterns across planning domains and generate guidance, not by retrieving a cached answer but by working through the problem. That’s a meaningful architectural shift, and it’s what makes encoding a firm’s best judgment into a system something firms can now actually do.
The client’s experience stops depending on the luck of who they were assigned to.
When that capability reaches every advisor in the firm, the client’s experience stops depending on the luck of who they were assigned to. And when the technical foundation is solid, advisors can build on it. They’re learning in context, not waiting years for the pattern to repeat enough times to know their own instincts are right. The human work of listening, reading what a client is really worried about, and earning trust becomes something they can grow into.
Firms that close the advice gap will see it first in retention and referral rates. Clients won’t be able to articulate why their experience feels more complete. They’ll just notice that nothing important seems to be missing; they’ll keep coming back, and they’ll send their friends.
Dan Daum is Co-Founder and CEO of advice intelligence platform WealthStream.
