How Five Firms Compete for Registered Investment Advisors

Wells Fargo, LPL Financial, RBC, Raymond James and Goldman Sachs provide custody services to external registered investment advisors through different business models. Their offerings give firms alternatives to the largest custodians, Charles Schwab, Fidelity Investments and BNY Pershing.

The five firms generally use custody to extend businesses they already operate for their own advisors, clients or financial products. Services can include clearing, technology, lending, cash management and business support. The amount of custody business they conduct for RIAs without affiliated brokerage representatives is not fully disclosed.

LPL reported $358 billion in independent RIA assets under custody at the end of the second quarter. It did not disclose how much came from firms without LPL-registered representatives. The company has served fee-only and hybrid RIAs since 2008.

LPL’s custody revenue comes from transaction activity, cash-sweep balances, lending interest, product-related economics and custody or platform fees, according to Chief Growth Officer Marc Cohen. LPL does not sell proprietary investment products or accept payment for order flow, he added.

“LPL is an advisor-centric business, and we do not compete for end clients,” Cohen wrote in an email. He said the company works with independent, hybrid, fee-only and corporate RIA models.

RBC Clearing & Custody has worked with external wealth management firms since 1979. The company serves more than 300 firms in the U.S. and selected global markets, including breakaway advisors, start-ups, wealth managers, money managers, dually registered firms and institutional businesses.

RBC’s Minneapolis-based technology team helps firms choose, implement and use technology. Pricing depends on each firm’s business model and use of RBC’s services, according to the company.

Wells Fargo’s First Clearing has worked with independent brokerages and RIAs for about 40 years. The company plans to launch a Wells Fargo RIA Solutions unit in early December, creating a third independent-advisor business alongside First Clearing and Wells Fargo Advisors Financial Network. First Clearing already provides services to TradePMR by Robinhood.

Wells Fargo has not disclosed First Clearing’s custody assets. Executives described the business as being in the next tier below Schwab, Fidelity and BNY Pershing, comparable with Apex Fintech Solutions. First Clearing does not publish a standard fee schedule. Prices depend on a practice’s business model, requirements and use of the platform.

Goldman Sachs entered the RIA custody market through its 2020 acquisition of Folio Financial. It has since expanded its RIA recruiting and provides custody services to Creative Planning, which acquired United Capital from Goldman in 2023. Goldman Sachs and Raymond James did not respond to requests for comment.

Advisors’ choices can depend on their clients and how easily a new custody relationship can be established. Synergy Financial Group, a San Ramon, California-based firm with nearly $1 billion in client assets, moved one custodial relationship from Pershing to Goldman while retaining Schwab.

Chief of Staff Shannon Irwin cited Goldman’s private wealth and banking services as an additional benefit for the firm’s ultrahigh-net-worth clients.

SageSpring Wealth Partners, based in Franklin, Tennessee, left Raymond James Financial Services in late 2024 and chose Schwab and Fidelity. President Jeffrey Dobyns cited technology, fees and the ability to use multiple custodians. He described the transition as easy, although he found the previous arrangement’s economics uncompetitive.

Brett Bernstein, CEO of Bethesda, Maryland-based XML Financial Group, uses Fidelity for the firm’s multibillion-dollar RIA and First Clearing for its brokerage, XML Securities. The firm oversees $4.3 billion in client assets and supports 25 advisors in five offices.

Bernstein said the arrangement helped two acquired teams join XML without requiring their clients to change custodians. “Any custodian you have, I don’t care what anyone says, it’s going to come with challenges,” he said. Advisors assess whether a custodian offers advantages in technology, products, service or brand recognition, according to Bernstein.