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How Fidelity’s Threshold Announcement Creates Opportunity for Small RIAs

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Fidelity’s decision to extend its $100 million custody minimum to existing RIA clients means many smaller advisory firms will need to make a decision about their future that may not have previously been on their radars. While the announcement created real uncertainty, it also created an opportunity. Firm owners who might never have considered a holistic look at their business now have a natural reason to do so.

When assessing a long-term solution, it’s important to consider which option best positions the firm, its clients, its assets, and the team for the future. For some firms, the answer may be a new custodian. For others, it may be a merger, a partnership with a larger RIA, or a long-planned succession that might be right in this moment.

A Forced Change Is Also a Natural Decision Point

Changing custodians is no small task. Client accounts must be repapered, workflows and integrations rebuilt, and every client walked through the process. That effort can consume months of time and attention, resources that could otherwise be spent creating an entity or considering a move that can create much more longevity and growth potential.

When a transition is unavoidable, such as with the upcoming June 2027 Fidelity deadline, it makes sense to evaluate succession, partnership, and growth options before moving a single account.

Partnering With a Larger RIA

For some firms, the Fidelity announcement may be the right moment to partner with a larger RIA that already uses Fidelity or a highly compatible custodial and technology platform. A well-matched partnership may allow an advisor to maintain much of what makes the firm successful, including client relationships and service philosophy, while gaining the scale, infrastructure, and resources of a larger organization.

Structuring the transition around compatible custody and technology can also keep operations moving smoothly. If the partner firm already meets Fidelity’s minimum, clients may be able to stay on a familiar platform rather than moving their accounts at all.

Weighing the Full Range of Options

Every firm’s situation is different, and the right path depends on the owner’s goals, timeline, and stage of career. Broadly, affected firms may consider:

Consolidating or growing assets to meet Fidelity’s minimum
Affiliating with a larger firm or network
Merging with a compatible RIA
Selling the practice, potentially as part of a longer-term succession plan
Remaining independent and moving to a new custodian

Each option carries different economics, long-term value implications, and consequences for clients and employees. An owner within a few years of retirement may weigh these choices very differently than one planning to build for the decades ahead.

How FP Transitions Can Help

FP Transitions has spent decades helping independent financial advisors identify, grow, and realize the equity value of the business they’ve built. For firms affected by Fidelity’s change, FP Transitions can help owners:

Evaluate strategic options before making a custodial decision
Connect remaining independent advisors with affiliation, partnership, merger, or sale opportunities
Identify larger RIAs that may be a strong fit based on custody, technology, business model, culture, and client experience
Understand the economics and long-term value of each alternative
Structure a transaction or partnership designed to protect clients, employees, and the value the owner has built
Develop a transition strategy intended to minimize disruption to the practice

An introductory call with our consultant team is a great way to start considering what a potential next best step is for your business.

Frequently Asked Questions

What is Fidelity’s new RIA minimum?

Fidelity now requires RIAs to custody at least $100 million in client assets on its platform. The minimum previously applied only to new firms; it now applies to existing RIA clients as well.

When does Fidelity’s $100 million minimum take effect?

Firms below the threshold must meet the minimum or end their custodial relationship with Fidelity by June 30, 2027.

Does Fidelity’s $100 million minimum apply to total AUM?

Most indications suggest the threshold is based on assets held at Fidelity, not total AUM across all custodians. In one example, a firm managing $200 million overall, but holding $60 million at Fidelity could fall below the minimum. Firms should confirm the details directly with Fidelity.

What happens if my RIA has less than $100 million at Fidelity?

Unless the firm reaches the minimum by the deadline, Fidelity will discontinue the custodial relationship, and the firm will need to move its client assets elsewhere.

What options do RIAs below Fidelity’s minimum have?

Options include moving to another custodian, consolidating assets from other custodians onto Fidelity, growing past the threshold, joining a larger RIA or network, merging, or selling the practice.

Can an RIA remain with Fidelity by joining or partnering with another RIA?

In some cases, yes. Some larger RIAs and platforms already on Fidelity have said firms that join them can keep their custody there, even if their own assets fall below $100 million. Each relationship is subject to individual terms and fit.

Should I change custodians or consider a merger?

It depends on the owner’s goals, timeline, and succession plans. Evaluating both before acting helps avoid repapering clients twice if a merger or sale follows a custodian move.

How long does an RIA merger or partnership take?

Timelines vary. Finding the right partner, completing due diligence, negotiating terms, and transitioning clients can take many months, which is why early planning matters.