There are many ways of looking for the pockets of wealth that dot the country. The IRS and the Census Bureau have data that show it in the typical way. AdvisorOne set out to create a novel look at where the wealth is in the United States and compare it with a snapshot of the number of advisors in each area, which we call AdvisorOne Wealth Zones.
To create our Wealth Zones we started with a list of the Top 100 wealthiest zip codes ranked by adjusted gross income. We then grouped neighboring wealthy zip codes and compared the number of households (as determined by tax returns filed in each zone) to the number of subscribers to Investment Advisor and Research magazines. This allowed us to see if advisors were tripping over one another or if the wealthy were in "danger" of having their assets neglected.
In the end, we created 20 Wealth Zones. A few, like Bryn Mawr, Pa., and Carmel, Ind., are standalone zip codes because they represented large pockets of isolated wealth according to the data. Most Wealth Zones were composed of several wealthy zip codes, like in Chicago, because advisor headcount varied greatly from zip codes that abutted one another and excluding them would radically skew the results.
We’ll be mining this data from time to time to provide what we hope is interesting, maybe even actionable, information for advisors. Our first effort is here, the Top 10 Wealth Zones With Fewest Advisors per wealthy household. The city that topped this list, and some other big cities, were a big surprise. Next week, we will unveil the Top 10 Wealth Zones With the Most Advisors per household.
Average AGI: $102,509
1 per 125 households
Just north of Indianapolis, Carmel is home to CNO Financial Group (formerly Conseco) and Delta Faucet, among other businesses. It was voted No. 14 on CNN Money’s best places to live in 2010. Still, the ratio of advisors to household shows there might be room for more advisor offices.
Average AGI: $139,570
1 per 157 households
From Coppell to Plano to Dallas proper, the Dallas Wealth Zone is high on wealth. Everything in Texas is big, or so the locals boast, and that’s certainly true of the wealth in this zone. What’s not as big is the number of advisors practicing here.
Average AGI: $166,658
1 per 176 households
The City of Big Shoulders has pockets of huge wealth, and this zone that includes northern suburbs and parts of the city is emphatic evidence of that point. Anyone not afraid of the Chicago winds—both the meteorological kind and those that come from politicians—might find a good opportunity to find clients.
Average AGI: $148,022
1 per 202 households
Katharine Hepburn attended the town’s namesake college, Woodrow Wilson taught there, and John Bogle, retired from Vanguard, is counted among its residents. But the real attraction for advisors of this toney Philadelphia suburb is the high adjusted gross income and the relatively few advisors.
Average AGI: $162,181
1 per 233 households
Miami has the glitz and glitter, the sand and the sun. And it has wealth. Two zip codes, one in the city and one in nearby Boca Raton, make up the Miami Wealth Zone. Maybe the advisors are in nearby zip codes, but maybe not.
Average AGI: $170,577
1 per 244 households
Wealth in Los Angeles is no great secret. This Wealth Zone includes part of the City of Angels, Beverly Hills, Manhattan Beach, Pacific Palisades and adjoining towns. If you can stomach the traffic, the California lifestyle has lots to offer and lots of clients to try to sign up.
Average AGI: $144,161
1 per 260 households
From Bethesda to Chevy Chase to Potomac, this Wealth Zone boasts an extremely high average AGI. Of course, the area has lots to offer between Baltimore and the nation’s capital. But nothing can top the wealth and the comparative lack of competition.
Average AGI: $123,235
1 per 291 households
Seattle has become a hot place to live, jokes about the unrelenting rain aside. It’s no surprise that places like Redmond, Bellevue, Issaquah and Mercer Island have plenty of wealth. Microsoft has helped to see to that. Maybe the Microsoft millionaires don’t think they need advisors--sems like an opportunity.
Average AGI: $140,310
1 per 308 households
Houston has seen its economy ebb and flow over the years. Like Dallas, it still has pockets of great wealth. This Wealth Zone includes parts of Houston, Sugar Land and Spring, home to the richest of Houston’s elite. Texas likes to claim it’s the biggest in everything, but Houston will have to settle for No. 2 on this list.
Average AGI: $136,804
1 per 363 households
From Mill Valley to San Jose to San Francisco, the Bay Area has an abundance of wealth, without the number of advisors to match. It’s hard to know why that’s the case. Of course, the cost of living is high, so maybe many residents of the San Francisco Wealth Zone are house-rich and cash-poor.
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