For years the Registered Investment Advisor (RIA) firms has been growing in prominence. And now forces are converging to fundamentally transform financial advising in the RIA model’s favor. Investors are demanding more from the companies they work with. Traditional advisor models are holding firms back from evolving to attract a new generation of clients. Innovation is making possible things once thought difficult or impossible.
With these influences shaping the industry, independent RIAs are poised to come out on top. Clients want the personal, investor-first service that RIAs can deliver. Independent advisors are fueling tremendous opportunity by pooling their talents. And the well-established network of businesses that support RIA firms is booming, offering more choice and sophistication.
Beyond Returns—Investors Want Trust
With complex financial pictures to consider and more information available than ever, clients want someone on their side to help spot the signal in all the noise. The advisor-client relationship is no longer one of biannual meetings and occasional check-ins. It’s now one of 24/7 access and collaboration, supported by an ever-changing array of messaging, video conferencing, and instant-notification apps and platforms. Investors are looking for someone they can trust to guide their holistic financial pictures with agility and ingenuity and to always do what’s best for them.
As the rest of the industry moves to meet this demand, RIAs are already on the cutting edge. Independent RIAs are held to a fiduciary standard and put their clients’ best interests ahead of their own. And the market continues to shift in their favor. The RIA channel is capturing more assets every year. Investors are figuring out the difference between suitability and fiduciary standards—if not in name, in practice—and it matters to them.
Even wirehouses are recognizing the shift and making changes to look more like RIAs. Tim Oden, national managing director of business development at Schwab Advisor Services™, believes this lightbulb will continue to click on for investors, leading to a shakeup in the industry. Schwab Advisor Services provides custodial, operational, practice management, and trading support to more than 7,500 independent RIA firms of all sizes and has been working with RIAs for over 30 years.