The cost of advisor silos
The default financial structure for a high earner, through no one's bad intent, looks like this. A CPA who handles the return. A wealth manager at a major brokerage running the brokerage and IRA accounts, usually on a percentage-of-AUM fee. An estate attorney who drafted documents at some point in the past five years. Sometimes a financial planner with a CFP designation operating somewhere between these. Insurance handled by whoever sold the most recent policy.
Each of these professionals is competent in their domain. Each is operating in good faith. None of them is responsible for what happens between them. The CPA isn't paid to think about whether the asset location across the brokerage accounts is tax-efficient. The wealth manager isn't paid to evaluate whether the 401(k) is being maxed correctly or whether the Mega Backdoor Roth conversion is available. The estate attorney isn't tracking the year-over-year drift in account titling that may have invalidated last year's trust funding. The insurance agent isn't modelling whether the existing policies fit the current income and family situation.
The result is a portfolio of decisions, each defensible in isolation, that produces a coordinated mess. Tax-inefficient trades in tax-deferred accounts. Tax-efficient ETFs sitting in tax-advantaged accounts where the efficiency is wasted. Charitable giving from the wrong account type. Roth conversions executed in the wrong years. Beneficiary designations contradicting the trust. Estate documents written when the wealth was a third of what it is now.
3–5
Advisors typical household has
0
Coordinated relationships among them
Each advisor optimizes inside their own lane. None of them sees the cross-lane consequences. The household pays the cost.
What coordination actually means
Coordination is not communication. Advisors who occasionally email each other are not coordinated; they are merely polite. Coordination is something stronger: a single advisory relationship in which one team holds the integrated picture, designs the architecture, and ensures that every decision made in any one domain reflects the decisions being made in the others.
In practice, this means a few specific things. There is one document, internally, we call it the architecture, that captures the household's full tax position, account inventory, retirement contribution plan, asset-location strategy, estate structure, and insurance coverage. The document is updated continuously. Every decision in any domain is checked against it before execution. When circumstances change, a vest, an exit, a job change, a real estate purchase, a child, an aging parent, the architecture updates and the downstream decisions adjust.
This is not exotic. It is exactly what a $100M family office does for the family it serves. The Virtual Family Office model is the same architecture, delivered at $300K–$1M income tiers rather than $50M+ net worth tiers, through a coordinated specialist network rather than a single in-house team. More on the VFO model →
The five coordination levers
There are roughly five places where the cost of being uncoordinated shows up most clearly. Each is fixable; none is exotic; together they account for the bulk of the lift that coordination delivers.
The fee question, answered honestly
Most wealth managers charge 0.75–1.25% of assets under management per year. On a $2M portfolio, that is $15,000–$25,000 annually, every year, in perpetuity. The fee is independent of the work performed, it scales with the assets, not the value created.
MicroTax's coordination fees are calibrated differently. We charge for the work, projection-building, asset-location modelling, conversion sequencing, charitable structuring, beneficiary review, at engagement rates that are typically a fraction of the AUM-based alternative on portfolios above $1M. For some clients we also manage assets directly; for others, we coordinate with an existing wealth manager. The fee structure is transparent and quoted before any work begins.
The honest framing: AUM-based fees are a reasonable model for clients who want a hands-off portfolio manager and not much else. They are an unreasonable model for clients who want coordinated planning across the full picture, because the fee is uncorrelated with the work that delivers the value. The coordination fee is correlated with the coordination work. That's the entire argument.
What coordination is worth over time
The single-year impact of better coordination is modest in percentage terms, typically 50–150 basis points (0.5–1.5%) of incremental after-tax return per year, depending on the starting position. The reason it adds up to a large number is compounding.
Consider a 45-year-old with $1.5M in invested assets, contributing $50K per year, and a 20-year horizon to retirement. Two scenarios. In Scenario A, the household operates uncoordinated, generic asset allocation, generic loss harvesting, no asset-location optimization, no Roth conversion strategy. In Scenario B, the same household operates under a coordinated architecture that captures roughly 100bps of incremental after-tax return per year through the five coordination levers above.
| At year 20 | Scenario A Uncoordinated |
Scenario B Coordinated |
|---|---|---|
| Total invested capital deployed | $1.5M + $1M contributions = $2.5M | Same |
| Assumed gross return | ~6% nominal | ~6% nominal |
| After-tax compounding rate | ~4.5% | ~5.5% |
| Portfolio at year 20 | ~$4.6M | ~$5.6M |
| Delta from coordination over the period | — | ~$1.0M |
Illustrative scenarios for educational purposes only. Actual outcomes depend on starting portfolio composition, tax bracket, contribution capacity, market returns, and the quality of coordination delivered. Individual results vary and are not guaranteed. This is not a personalized recommendation.
A single percentage point of incremental after-tax return per year, compounded over 20 years, is the difference between two materially different retirements. Coordination is how that point is earned.
Annual tax + investment efficiency gain compounded at 6% net return
What coordinated planning is worth, over 20 years
How MicroTax handles coordination
Wealth coordination sits at the center of the MicroTax service stack. Tax strategy is the foundational layer; §7702 retirement and estate planning are advanced layers; coordination is the connective tissue that ensures all four work together as one architecture.
The engagement begins with the full picture: tax position, account inventory, asset allocation, contribution capacity, estate structure, insurance coverage, business or partnership interests where they exist. From that, the integrated architecture document is built. Decisions in any one domain are checked against it before execution. The architecture updates as circumstances change.
For some clients, MicroTax also manages assets directly through fiduciary fee-only arrangements. For others, particularly those with longstanding wealth-manager relationships, we coordinate with the existing advisor rather than replacing them. The right answer depends on the client's situation, the quality of the existing relationship, and the cost-versus-coordination tradeoff. We're transparent about which model fits which situation.