Merrill Lynch is encouraging its advisors to reaffirm the value they bring to clients as industry-wide fee compression affects the wirehouse more acutely than its peers. According to AdvisorHub, Co-President Lindsay Hans shared that Merrill's advisory fees, once at a premium, have declined at a faster rate than the industry since 2017. Advisors now charge fees comparable to others in the market, marking a significant shift for Merrill.

The trend of fee compression isn't unique to Merrill. Across the industry, managed account fees for portfolios of $750,000 or more consistently have declined. Cerulli Associates' research shows an average annual fee for discretionary advisory accounts of 1.02 percent, with wirehouses typically charging around 10 basis points more than independent broker-dealers. Merrill's fees vary by account size, starting around 1.19 percent for smaller households and lowering to 0.53 percent for accounts with at least $50 million.

To compete amid shrinking fees, Merrill and other wirehouses urge advisors to justify their pricing through comprehensive financial planning, risk management, and alternative investment services.

AdvisorHub also reports that some advisors within Merrill agree that fees may need an increase to reflect their value accurately. One major producer noted that fees may indeed be set "too low" for the level of service provided, although perspectives vary on whether adjustments are necessary.

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