There are plenty of new, untapped clients for financial advisors, and there’s an abundance of wealth available that that can support RIAs’ growth well into the future.

That was the message shared by Tom Bradley, managing director of Schwab Advisor Services and a veteran of both the retail and institutional sides of the financial industry. Bradley made his comments during the first day of the Next Chapter 2022: Rockin’ Retirement virtual conference sponsored by Financial Advisor.

Advisors in all of the financial advice business models now control only 25% of the wallet share of individuals in the United States, he said. So there’s a huge pool of fresh assets and fresh clients available.

“This market provides opportunities for different sizes of advisory firms,” Bradley said. “Advisors of all sizes can co-exist. It is just critical that you do not lose sight of the North Star—the client. RIAs will continue to grow at a faster rate than any other business model in the industry.”

Bradley, who is now focused on the service teams for advisors at Schwab Advisor Services, was previously in the private equity world.

He said the registered investment advisor model has an advantage over others when it comes to gaining clients because RIAs are fiduciaries and not salespeople. And the industry is evolving even further into wealth management.

In the face of fee compression, “advisors have been able to maintain their fees because they are expanding their services,” Bradley said. “You might want to look at a different business model than charging for AUM. Charge for services, or by retainer or by subscription.”

Bradley and moderator Steve Gresham, the CEO of the Execution Project, a consulting firm for financial companies, touched on the role of digital advances in the businesses of advisory firms, agreeing that technology is affecting all aspects of advice, making it more efficient for advisors to handle more clients.

Surprisingly, “a lot of the smaller firms are the best adopters of digital tools because they have to be,” Bradley said. “Getting people at some large firms to adopt digital tools can be challenging.”

Bradley also spoke about the need for RIAs to consider succession planning, and how that will affect the attractiveness of their firms.

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