Record-breaking RIA growth hits $144.6 trillion in assets under management
In 2024, registered investment advisory firms saw a surge in assets under management, crossing $144.6 trillion, breaking previous records. The number of firms registered with the SEC also hit new highs, along with AUM, clients, and employees.
Challenges in organic growth versus M&A and asset appreciation obscure the overall success of RIAs. Financial advisors considering joining or launching an RIA must navigate macroeconomic forces and potential client and employee issues, according to industry experts.
New entrants into the RIA space are testing their independence before potentially joining larger firms for infrastructure and support. The enduring appeal of autonomy in wealth management continues to attract new firms, highlighting the industry’s entrepreneurial spirit.
RIAs are evolving with changing business models, attracting advisors with opportunities to retain a greater share of revenue and design compensation models. The IAA and COMPLY study reflects the scale and nature of RIAs, showing fewer affiliations with brokerages and an increase in financial planning services.
Assets under management at RIAs hit a record $144.6 trillion in 2024, surging by 12.6% after a strong year for stock and bond values. The number of SEC-registered RIAs has increased steadily, reaching a record 15,870 firms.
SEC-registered RIAs now serve a record 68.4 million clients, including both retail-facing wealth management firms and fund companies. Employment at RIAs has seen eight consecutive years of growth, with non-administrative roles rising by 2.6% to a record 1.03 million jobs. Job gains in the RIA channel have been strong, but slightly below the past decade’s average of 3.2% yearly. The surge in metrics is mainly due to rising asset values and the expanding U.S. economy. The competition to generate organic growth and recruit talented advisors is fierce among RIAs, driving industry growth.
Read more at Yahoo Finance: Record-breaking RIA growth, in 5 charts