Separately managed accounts, once a perk for the ultra-wealthy, are becoming a mainstream tool as advisors shift from selling funds to building portfolios around each client. The appeal starts with customization, since clients increasingly expect portfolios that reflect their goals and preferences. Tax management is a bigger draw, because account level ownership lets advisors harvest losses, time gains and coordinate across a household all year rather than once at tax time. Clients also see exactly which securities they own, which sparks more meaningful conversations. Technology, including direct indexing and AI, makes personalization possible at scale, and the broader move toward fee-based advice helps fuel adoption. Managed account assets are growing quickly, and retail SMAs alone are projected to reach trillions of dollars. The takeaway is that after tax results and personalization are turning from luxuries into expectations, and SMAs sit right at the center of that shift.

Finsum: When clients care about what they keep, not just what they earn, the account structure becomes part of the advice, and SMAs give advisors a way to prove that value year round.