Investors seeking a fiduciary have more large firms to choose from than ever, but telling them apart is getting harder.
Key Takeaways:
- Hybrid RIAs with brokerage ties still hold about half the assets among $5 billion-plus firms.
- Clients whose advisor shifts between standards of care are the most open to switching providers.
- Leading firms are leaning on team-based service, tax management, and clearer fee disclosure to stand out.
Cerulli Associates counted 343 registered investment advisors managing more than $5 billion, up from 194 five years earlier. Credent Wealth Management, an Indiana-based fee-only RIA with $5 billion in assets, commissioned the white paper.
Part of the challenge is that large RIAs don’t all work the same way. Some earn only advisory fees paid by clients, while others sell insurance, keep brokerage affiliations or use commission-based products, the report said.
“The distinctions between fiduciary and suitability standards, fee structures, and product offerings are often opaque, making it difficult for the average client to understand differences across firms,” said Brendan Powers, a director at Cerulli.
See more: Strengths & Weaknesses of Advisor Fee-Only Models from the Client Perspective
Every segment of the $5 billion-plus market is growing, but firms with brokerage or insurance ties are expanding faster, Cerulli found. True fee-only RIAs saw their share of assets fall from 42% in 2020 to 34% at the end of 2025. As a result, clients may have a harder time finding a firm held exclusively to a fiduciary standard.
How Fiduciary Duties Differ Across RIA Models
Hybrid RIAs with brokerage businesses remain the largest group. Their count rose from 104 to 186, a 12.4% compound annual growth rate, while their share of assets held steady at 51%, according to Cerulli’s market sizing.
Independent RIAs with insurance licenses grew the fastest, climbing from seven firms to 36 for a 37.3% annual pace. Over the same stretch, their asset share doubled from 7% to 14%, the study showed.
True fee-only firms also expanded, from 83 to 121. Still, their 7.8% annual growth rate trailed both rival segments, Cerulli’s figures show.
Growth rates are only part of the story. In a hybrid model, the white paper noted, the standard of care can shift within a single client relationship. An advisor may act as a fiduciary when giving advice, but not when selling a commissionable product.
The two standards set different bars. Under Cerulli’s definitions, a fiduciary must always act in the client’s best interest and avoid or disclose conflicts. Suitability only requires a recommendation to fit the client’s profile, even if a better or cheaper option exists.
David Hefty, co-founder and CEO of Credent, tied the trend to industry consolidation. “In a time of accelerating consolidation, it seems more true fee-only independent RIAs have evolved to take on the look of the broker/dealers that we previously left,” he wrote in the paper’s foreword.
Satisfaction Gap Favors Fiduciary Relationships
Clients appear to notice the difference. Among affluent investors working with a fiduciary, 73% are satisfied and not looking for a new provider, according to Cerulli’s Affluent Investor Tracker.
By comparison, just 48% of investors whose advisor may recommend products that put the advisor’s interests first say the same. Another 48% in that group are satisfied but open to other options, the survey found.
Clients in mixed arrangements, where an advisor acts as a fiduciary only some of the time, were the least settled. Only 42% were satisfied and not seeking a new provider, while 54% were open to other options, Cerulli reported.
Many investors also lack clarity on how they pay for advice. About 33% of affluent investors say they pay a percentage of their assets, while 22% pay commissions, the report found. Another 15% aren’t sure how their provider gets paid.
“Investors shouldn’t have to be experts in the wealth management industry to understand who they’re trusting with their financial lives,” Hefty said.
What Sets Leading RIAs Apart
Beyond business models, Cerulli identified several traits shared by leading RIAs. More than half of RIAs (56%) work in teams backed by centralized specialists in areas like tax and financial planning.
Tax management is another focus. Nearly 70% of affluent investors say it’s important for their provider to help cut their tax bill, according to the report. In response, leading firms are adding tools like tax-loss harvesting, direct indexing, and bond ladders.
ETFs make up 35% of RIAs’ product mix, the largest share of any vehicle. Cerulli expects that figure to reach 38% over the next three years, while mutual funds slip from 24% to 21%.
See more: Beating Rising Rates With Equity ETFs Designed for the Task
Fees are part of the picture, too. Cerulli calculated that the average $1.5 million RIA client pays about 147 basis points a year, or $147 per $10,000. That includes 92 basis points (basis points) in advisory fees and 55 bps in product costs but excludes commissions and other charges.
“Cost matters, but value matters more,” Powers said.
Portfolio mix can shift those costs as well. Product fees fall from 55 bps to 34 bps when low-cost ETFs make up 75% of a portfolio, Cerulli estimated. A 15% allocation to alternatives, on the other hand, pushes them above 75 bps.
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