Typically people use a single financial advisor. For most people the use of a financial advisor is recommended, let alone multiple advisors. I also don’t mean a husband and wife team as two advisors. I mean a financial professional from whom some guidance can be gleaned and a plan put in place.
But then I have a few clients who have multiple financial advisors. I have not asked them directly as to why. I probably should just so that I can understand them and their thought processes better.
But my thoughts are that they have what I consider to be Madoff concerns. Many people were financially ruined because they trusted the wrong person with all of their assets.
Fraud itself is not a major concern with advisors from the major and minor investment houses. Boiler room operations are not as rampant as they have once were; at least to my knowledge. Also there is SPIC coverage to assist.
But knowing that their portfolios are split between two and three advisors with major Broker Dealers can assist in minimizing risk.
But the costs can be high. I have clients who spend over $30k in fees and most are retired and content with their multiple advisors.