Schwab Reaffirms Commitment to Smaller Advisory Firms -- Barrons.com

By Kenneth Corbin and Andrew Welsch

BOSTON -- Charles Schwab's chief executive is reassuring small registered investment advisor firms that they will always have a home on Schwab's custody platform. Here at the firm's annual Impact conference, CEO Rick Wurster also said that the company's in-house advisors don't intend to compete with the 17,000 independent RIAs it serves.

Wurster was asked about Schwab's thinking on smaller RIAs, specifically those with less than $100 million in client assets under management. Fidelity, Schwab's closest rival in the advisor-custody business, recently decided to cut off services to RIAs that don't meet that asset count.

Wurster indicated that Schwab doesn't plan to follow suit. "We couldn't be more committed to the RIAs on our platform of any size, including those with less than $100 million," he said. "We want to support you with our platform, with our ecosystem, and do everything we can to make RIAs of every size successful."

Some of Schwab's recent moves have raised questions about it moving upmarket and potentially favoring larger firms over smaller competitors. A year ago, Schwab said it was raising the minimum account size to be eligible for referrals to RIAs in the Schwab Advisor Network from $500,000 to $2 million. This summer, Schwab said that it would raise the minimum again from $2 million to $5 million. Schwab has also raised the fees it charges firms to participate in the referral program.

In the third quarter, Schwab reported that RIAs with less than $100 million in AUM account for 13% of its net new assets. Fidelity's move, which could send smaller firms on that platform in search of a new custodian, could marginally increase that share.

Fidelity told RIAs that they will have until the end of June 2027 to meet its minimum requirement. The new policy affects only a few hundred firms, representing less than 1% of Fidelity's total clearing and custody assets under administration, according to a person familiar with the matter.

The policy change may spur affected RIAs to either add more assets to Fidelity or move their business to another custodian. Some rival custodians have used the news as an opening to try to win new RIA clients. For example, Betterment is waiving a platform fee through the end of 2028 for RIAs that add Betterment as a custodian. Eligible RIAs must currently custody assets with Fidelity and be new to Betterment.

Noncompete pledge. In his keynote address at the Impact conference, Wurster sought to draw a line between the activities of Schwab's in-house wealth force and the independent RIAs on its network.

Schwab has been adding advisors to its branch offices around the country, but Wurster said that those deployments are intended only to support Schwab's own financial consultants and aren't a competitive threat to local RIAs.

"The folks in those offices are not going out into the local community and competing for new business," Wurster said. "They are working with our existing Schwab clients that we have built relationships with over years, decades."

Schwab executives are talking up new capabilities the firm is rolling out to its RIAs, including today's announcement that it is investing in Nevis, an AI platform that aims to help advisors knit together their IT systems. Schwab also announced the availability of Ester, a tax- and estate-planning tool from Wealth.com, and Claude for Financial Advisors, Schwab's collaboration with the AI lab Anthropic.

Tax-aware long/short. Wurster said that the company is also working to give advisors more access to long/short strategies, a tax-advantaged investing strategy that has become very popular with advisors and wealthy clients. In September, Schwab throttled the growth of long/short strategies by raising the minimum asset requirement to fund long/short separately managed accounts to $10 million from $1 million. Wurster told advisors the demand was "overwhelming" and growth for the complex strategy was at a pace Schwab hadn't expected. He said the company was working on a path forward that includes collaborating with outside companies and launching a proprietary long/short offering, adding that details will be forthcoming. Schwab's third-quarter earnings report showed that margin loan balances at the company rose 14% quarter over quarter to $187.9 billion. The figure includes $60.7 billion related to long/short strategies.

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October 28, 2026 13:13 ET (17:13 GMT)