Against Challenging Investing Environment and Growing Competition, Independent Financial Advisors Remain Optimistic About the Future

Thursday, June 16, 2016 9:40 am PDT



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Independent advisors see growth ahead, according to Schwab's latest Independent Advisor Outlook Study.

TUCSON, Ariz.--(BUSINESS WIRE)--Schwab Advisor Services has released findings from its 19th semi-annual Independent Advisor Outlook Study (IAOS), which reflects the opinions of 930 advisors at independent investment advisory firms that custody with Schwab. The study results, representing more than $300 billion in assets under management, were announced today to a group of advisors during Schwab’s annual EXPLORE conference. Complete findings are available for download here.

Highlights from the Study include:

Optimistic, in spite of increased competition and mixed implications of new DOL Fiduciary Rule

  • Nearly three quarters (73%) of advisors are ‘very optimistic about opportunities for registered investment advisors – RIAs – to grow in the next five years’
  • Two in three (66%) expect more competition for securing assets in this timeframe and, likewise, believe the need to differentiate their firms from competition is greater than ever (65%)
  • One in three (36%) think the Department of Labor’s Fiduciary Rule will increase competition for RIAs, and that it will create greater challenges for RIA firms to differentiate themselves from wirehouse firms (35%)
    • More than half (57%) believe the rule will drive more questions/interest from clients in an advisor’s fiduciary responsibilities

An uphill path to meet clients’ investment goals

  • Advisor confidence that the S&P will continue its upward trajectory is at a four year low, with just over half (56%) of advisors expecting it to increase in the next six months
  • Advisors and clients alike share concerns about market volatility, the interest rate environment and the specter of another recession in the US
  • The majority of advisors (90%) have needed to reassure at least some portion of their client base in the past six months that they will achieve their investment goals
  • Over half (57%) of advisors expect difficulty in achieving their clients’ investment goals in the current investment environment

Growth and readiness as client assets move through lifecycle stages

  • One in three (38%) advisors report spending the majority of their time considering how to prepare for future growth
  • The majority of organic growth the next five years is expected to be driven by founders and principal-level equity owners
  • Currently, advisors have most assets under management (37%) in a ‘mature’ lifecycle stage (investor focused on protecting and maintaining wealth), followed by 25 percent in ‘aging’ (investor focused on spending and planning for distribution to heirs), 23 percent in ‘mid-lifecycle’ (wealth is steadily building but investors’ needs are getting more complex) and ten percent categorized as ‘young assets’ (investor’s long-term goals are just starting to form)
    • Looking ahead five years, advisors predict a decreasing percentage of AUM in the ‘aging’ and ‘mature’ categories (23% and 33% respectively) and an increase in ‘mid-lifecycle’ (25%) and ‘young’ (12%) assets
  • Approximately nine in ten advisors report being prepared to meet the needs of ‘aging’, ‘mature’ and ‘mid-lifecycle’ assets, while two-thirds (68%) are prepared for young assets, and a little over half (57%) say they are prepared to serve emerging assets (investors in the initial stages of building wealth)

Targeting new markets

  • Younger and more diverse client assets are expected to play an increasingly prominent role in firms’ talent strategy and client offerings
    • 37% of firms are factoring changing demographics into their succession planning
    • 35% of advisors are aiming to attract and serve younger clients, 29% aim to attract and serve female clients, and 10% plan to attract and serve more ethnically diverse clients
  • Two-thirds of advisors still aim to attract and serve clients similar to those they have today – and are hiring accordingly

About the Independent Advisor Outlook Study

The Independent Advisor Outlook Study, conducted for Schwab Advisor Services by Koski Research, has a 3.2% margin of error. Koski Research is not affiliated with nor employed by Charles Schwab & Co. Inc. All data is self-reported by study participants and is not verified or validated. Advisors participated in the study from April 19 – May 1, 2016.

Detailed findings can be found at

About Charles Schwab

At Charles Schwab we believe in the power of investing to help individuals create a better tomorrow. We have a history of challenging the status quo in our industry, innovating in ways that benefit investors and the advisors and employers who serve them, and championing our clients’ goals with passion and integrity.

More information is available at Follow us on Twitter, Facebook, YouTube, and LinkedIn.


Through its operating subsidiaries, The Charles Schwab Corporation (NYSE:SCHW) provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC,, and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; compliance and trade monitoring solutions; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at and

Brokerage Products: Not FDIC Insured • No Bank Guarantee • May Lose Value

Schwab Advisor Services™ serves independent investment advisors and includes the custody, trading, and support of Schwab.

Independent investment advisors and Schwab are independent of each other and are not affiliated with, sponsored by, endorsed by, or supervised by each other.

For informational purposes only.



Charles Schwab
Rob Farmer, 415-667-0083
The Neibart Group
Mayrav Weiss, 718-801-8864


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