Median client accounts at registered investment advisory firms that provide financial planning services grew last year at a slower rate than the S&P 500, according to a new study.
The rankings below, compiled by financial advisor lead generation and client matchmaking service SmartAsset, tracked the largest average account size in the RIA channel based on firms’ Form ADV filings as of November with the Securities and Exchange Commission. Compared to the same time a year earlier, the RIA firms matching SmartAsset’s criteria managed a median client account of $426,662, which is a 10.3% bump. The S&P surged by about 30% in that span.
As with any ranking of RIAs, the findings come with caveats. Many firms use the business entity for various purposes besides their main advisory company, and industry consolidation continues. Still, the numbers offer a lens into family offices and other RIAs that cater to high net worth and ultrahigh net worth clients — an often-coveted but challenging base of customers that presents valuable opportunities.
“By understanding and addressing the unique needs of HNW and UHNW clients, and implementing effective practice management techniques, financial planners can enhance client satisfaction and organically grow their client base through referrals,” Bruce Lee, CEO of Chicago- and Scottsdale, Arizona-based Keebeck Wealth Management, said in an email.
The best strategies for expanding into the niche include professional networking with attorneys and accountants and pursuing thought leadership by publishing thoughtful financial content online and hosting seminars, Lee said. In terms of practice management, holistic planning, deep client relationships, advanced technology and segmentation of customers can give advisors an edge, he added. And the base is looking for personalized investment and estate services.
“HNW and UHNW clients often have intricate financial portfolios, including diverse investments, business interests and international assets, requiring sophisticated management strategies,” Lee said. “Preserving wealth across generations is paramount. We focus on creating robust estate plans that minimize tax liabilities and ensure a smooth transfer of assets.”
SmartAsset compiled its sample of 6,461 RIAs out of the SEC’s database by searching for firms based in the U.S. but not in a personal residence, as well as those that provide financial planning services, disclose regulatory assets under management and monitor investments. Firms with regulatory disclosures were excluded. At more than 1.56 million accounts, RIA aggregator Edelman Financial Engines reported the largest base out of all the firms.
The RIAs with the largest average account size comprised some massive family offices such as Los Gatos, California-based Comprehensive Financial Management and multifamily firms like Coral Gables, Florida-based WE Family Offices. However, the criteria also captured some asset management firms and RIA subsidiaries that only listed a small number of accounts, such as the No. 1 firm on the list, Atlanta-based Arkadios Capital’s Arkadios Wealth Advisors, and the No. 2 firm, West Des Moines, Iowa-based Sammons Financial Group Asset Management.
“Depending on their target market and specialties, some firms may focus on clients with different asset levels, which could affect the average number and size of accounts under management,” Jaclyn DeJohn, a certified financial planner who is SmartAsset’s director of economic analysis, wrote in the firm’s report. “Measuring these average account numbers and values, along with the total AUMs, could help industry stakeholders understand the strategies and operations of different firms.”
Scroll down the slideshow to see the rankings of the top 30 RIAs based on average account size. For last year’s list, click here. And see more analysis of the size and expansion of the RIA channel:
Note: All of the below data came from SmartAsset’s November 2024 analysis of RIA firms’ Form ADV filings, ranking firms based on the quotient of their regulatory assets under management divided by their number of accounts. The numbers are rounded.
