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Indie Advisors More Bullish on 2021 Growth Prospects

Business Growth Strategies

Compared to last year, advisors are more optimistic about growth of the RIA industry and their practices in 2021 and beyond, according to the Schwab Advisor Services’ latest Independent Advisor Outlook Study. 

In fact, nearly half of firms surveyed (47%) said they expect the RIA channel to grow at a faster rate than the market, up from 33% in August of last year.

Preference for the independent channel is the primary driver for growth, according to more than half (57%) of advisors surveyed. An increasing number of advisors also view RIA systems—including platforms and technology (24%) and the increasing number of affluent investors (13%)—as having an impact on the continued expansion of the independent channel.

“The independent advice industry has reached a new growth tipping point, driven by investors who appreciate the value of fiduciary advice and advisors who continue to raise the bar in creating the ideal client experience,” notes Bernie Clark, Executive Vice President and Head of Schwab Advisor Services. 

Entering its 14th year and reflecting responses from RIAs on both the Schwab and TD Ameritrade Institutional platforms, the current wave provides a snapshot on the outlook for industry and firm growth, a look into the new realities for firms post-COVID, and insight into how advisors view innovation.

Firm-Level Growth

At the firm level, almost all RIA firms (94%) expect growth in net new assets this year, with an average expected growth rate of 18% in net new assets by the end of 2021. In terms of drivers, 9 out of 10 firms expect organic growth (existing and new clients) to have a greater impact than inorganic growth (M&A transactions and new advisors bringing in business).

Schwab notes that half of independent advisory firms (50%) added more clients in 2020 than in previous years despite the challenges presented during the global pandemic. In some cases, these new clients were different than RIA firms’ existing client base, with some advisors noting new clients are more tech savvy (44%), younger (34%), more affluent (26%) and more diverse (17%) than current clients, the study shows.  

When asked what the biggest barrier to growth for the RIA industry will be in the next two years, respondents continue to cite new forms of competition, with 27% citing this factor in 2021, compared to 23% from last year. 

Adaptability and Changes

Most advisors (72%) report that they became more flexible in adapting to change due to COVID-19. What’s more, they have developed new workflows to meet client needs (56%) and have gotten to know their clients better (28%). They have also worked more hours than normal to meet client needs (33%), the study shows. 

In a post COVID-19 era, advisors expect that the ways in which they communicate and the physical location of their teams to be lasting changes at their firms, with regular use of video conferencing calls, remote work and the need for less office space listed as the top three lasting changes. Specifically:

  • Regular use of video calls with clients (62%)
  • More staff working remotely (40%)
  • Less need for office space (33%)
  • More online solutions for clients, such as services, transactions and reporting (33%)
  • More automated and tech-supported workflows (32%)
  • More virtual events, including CE credits and networking (25%)

Recruiting will also look different at half of RIA firms with many advisors noting that it will be easier to attract talent from a wider geographic radius and easier to hire more diverse talent. 


Additional findings show that 6 out of 10 firms (59%) view the technology industry as the primary driver of innovation in the RIA industry today. The need to streamline processes (46%) and changing client needs (36%) are also viewed as top drivers. Moreover, 65% believe that continued innovation will come equally from within the RIA industry, as well as by adopting innovations from other industries.

“As advisors look ahead, continued innovation and operational flexibility will be critical to capturing opportunities for growth, serving evolving client needs, and differentiating in this increasingly competitive market,” Clark emphasizes.

The study was conducted for Schwab Advisor Services by Logica Research from April 13–26, 2021, with responses from 953 independent investment advisors who custody assets with Schwab or TD Ameritrade, representing a total of $400 billion in AUM.