The number of boomers who have assets spread all around is “amazing,” says Robert Graham, CEO and president of RG Capital LLC, Scottsdale, Ariz. “They have an average of 3 financial advisors each.”

By retirement, “some older people even forget what they have,” he continues.

Some boomers do try to coordinate these various accounts, assets and relationships with their retirement plans, say professionals interviewed for this story. And some do try to manage the related statements, reports and other materials.

But self-coordination rarely occurs, advisors say. Over- and/or under-allocation can result, and this can “wreak havoc” on the retirement plan, says Tim Johnson, a fee-based financial planner who is also chief investment strategist at Lincoln Financial Advisors, Nashville, Tenn.

So what are financial advisors to do?

Consolidation of assets, accounts and/or advisory services is the solution often recommended–as a way to simplify the paperwork, increase efficiencies, assess/balance risk, and streamline retirement income management.

As boomers near retirement, in fact, banks, mutual fund companies, insurers, advisors and debt companies increasingly nudge boomers to consolidate in one way or another–by account, product type, or advisor.

But the C-word is a flash point for many boomers, say professionals.

Boomers don’t want to consolidate because they say they’ve spent their entire lives avoiding putting all eggs in one basket. They say it’s “too risky.”

What’s more, some are “conflict-averse,” says Graham. They don’t want to have to tell an old advisor or provider that they’re moving assets to a new advisor or firm.

So, the real question for advisors is, how to address the diversify/consolidate equation with boomer clients?

It is the advisor’s job to demonstrate the value of consolidation, says Graham. The advantages may include simplification of the information and one point of contact.

There are benefits to diversification, too, says Johnson. But there is a “large disadvantage” if a boomer tries to diversify advisors, not types of financial assets, he says, especially when entering retirement.

“It is vital that some professionals know where all the money is being allocated and what risk levels the client is assuming,” he explains. “Without that, no one is captain of the ship or looking at the big picture.”

Diversification needs to be done with realistic targets and performance expectations and in a way that fits the boomer’s own situation, stresses Barbara Sullivan, a communications strategist and managing partner at Sullivan & Company, New York. Financial professionals endorse it as the preferred financial management approach, she indicates.

Specifically, she suggests advisors do this by consolidation with one financial advisor. This “makes it easy for the client, as there is now one point of contact, while the assets can remain diversified” as governed by the plan, and the client can still receive statements from the individual providers.

“Show the boomer that you can have money in many places and in different types of investments, but the custody of the accounts can be with one advisor,” she sums up. Also, discuss how this won’t impact the security of the money or the boomer’s financial safety, she suggests.

Sullivan recommends a 3-point approach: Make consolidation relevant to client needs; make it easy for the client in a way that mitigates risk; and be proactive about staying in touch with the client.

What advisors should not do is present consolidation by product, she says. “For instance, don’t start out by saying, ‘let’s go with one mutual fund company so you can get the break-points on the charges.’”

That’s a product consolidation, and it does not work, she says. “Rather, sell your ability to tailor solutions to the boomer’s needs.” If getting mutual fund break-points makes sense for the plan, she allows, that’s fine. “But remember that any break-point is minor in comparison to the impact that a well-diversified and coordinated plan has on client goals.”

As for proactive contact, Sullivan says that advisors who custody assets should stay in touch after consolidation.

“People like having a human being to call and to call them, especially as they get close to retirement,” she explains. This enables the advisor to give positive reinforcement, too, as well as to nudge the boomer to take other important steps like estate planning, she says.

Gordon F. Homes, a senior financial planner with MetLife in Indianapolis, firmly believes the strength of the advisor-client relationship is key to an advisor’s ability to discuss consolidation with boomers and to implement it where needed.

When an advisor gets more invested in the relationship, that impacts how comfortable the boomer feels, he says, adding that he believes clients place business where they feel the greatest trust.

“So, yes, talk business (with the boomer), but also talk about what is important to the client,” he says.

Be sure to cover how the boomer feels about managing the reports they receive from various financial firms. Many boomers say they’ve grown “weary” of trying to keep up with it all and with the relationships with various advisors, he observes.

Point out how consolidating with one advisor will enable the advisor to monitor the client’s investments, stay up with the balances, simplify the reporting, track the performance, and provide one point of Internet access.

The Internet access is a “big bonus,” Homes adds, because many boomers find it’s “not practical” to check multiple accounts online.

Graham says he presents consolidation in the context of “doing what is important to you (the client).” So, if a dentist is working 6 days a week, he says he might discuss “how you will be able to get more time, put it all on one document, see how you are achieving your goals, and return to focusing on your vision and goals.”

Too many advisors start the consolidation discussion with fact-finding, says Graham. “You do need to check the facts,” he allows, “but start first with the vision, goals and values. That helps boomers see that ‘this advisor cares about me, not just about my accounts.’” That, he says, lowers the priority they put on multiple accounts–and increases trust.

Graham says he has done this for 5-7 years, and that 90% of new clients do consolidate (all but bank accounts).

Does he consolidate life and annuity policies? “Yes, but only if it helps the client get into a better position.” If selling a new policy doesn’t put the person in a better position, though, he suggests that he become the agent of record for existing accounts “so I can provide advice.”

Never should an advisor set up a portfolio or consolidate assets for the benefit of the advisor–say, to get high up front commissions, Graham says. “Always do everything in the client’s best interests.”

Johnson agrees. His firm’s philosophy borrows from the medical community: “First do no harm.” For instance, he says, “don’t replace insurance policies for convenience…. If it’s not in the client’s best interest to replace, I say, ‘I’ll help oversee this for you.’”

So, too, with Homes: “I don’t have a scorched earth policy,” he says. “It is not necessary to eliminate everything the client has done. Look at what is in the best interest of the client and go from there.”

It is true that advisors don’t get paid for overseeing existing insurance contracts, Johnson says. “But that undermines the client’s bias against consolidation, too.”

Some clients prefer having multiple advisors anyhow, he notes. “They may say, ‘this is my main advisor.’”

His response is, “okay, but you need to communicate freely with that one advisor, so that someone knows” where the assets are and can monitor the big picture.

That helps keep the allocation in balance, he says. For instance, one of Johnson’s clients has a big holding in an energy stock. “But we know that, so we allocate around that big position” using a fee-based, managed money approach.

It also helps at year-end. If all the investments are spread out without consolidation, there is no way to assess performance, Johnson says, especially if money has been added to one account and assets are liquidated from another.”

The takeaway: Talk with boomers about consolidating with one advisor who oversees diversification among multiple assets and accounts.

That will help the boomer achieve tax, cost and performance efficiencies that may otherwise be elusive, indicates Graham.