As Financial Advisor’s annual RIA survey reveals, most advisory firms enjoyed asset growth of about 30% last year, only to give most of that back in the first six months of 2022. That wouldn’t be so bad, given the robust state of the RIA economy, except that most clients have also seen their 2021 portfolio gains evaporate.

At this year’s Invest In Women conference in late June, I had the opportunity to discuss this state of affairs with a number of advisors—most of whom reported that the majority of clients could handle the current bear market. Two advisors, however, said that if clients were to see their 2020 gains disappear, it could well be a different story.

Almost from the beginning of the pandemic, portfolios were the least of most people’s concerns. That’s still the case for many, but as the post-Covid world takes shape, the stars are realigning.

As senior editor Eric Rasmussen writes in the cover story accompanying the survey on page 35, the days of “too much of a good thing” could be coming to an end. Abby Joseph Cohen put it succinctly when she said that the “everything is going up era is over.”

It’s also clear that the talent shortage pervading most sectors of the job market, from airline pilots to nurses and truck drivers, is hitting the RIA world, too. While a handful of new-concept RIA fintech vehicles are trying to handle vastly more clients with the same number of advisors, the jury remains out on that model’s viability.

Most robo-advisors, despite their intriguing technology, did not turn into the threat they were perceived to be five years ago. Some recently have been slapped with hefty regulatory fines.

A few years ago, RIA firms with the highest profit margins were seen as the best managed. But as sophisticated institutional investors move into the space and start looking under the hood, they are realizing that some super-profitable firms could simply be underinvesting in the business and milking clients while sacrificing future growth.

The upshot: Just when the investment puzzle is turning more complicated, RIA firms are witnessing their rivals turn up the competitive heat and add more services to enhance the quality of their clients’ lives. But then, isn’t that what any business is supposed to do to ensure its viability?