From Yahoo Finance: 2025-06-06 16:06:00

Financial planners are increasingly turning to mutual fund wrap programs to manage client investments, with a 20% increase since 2020. This shift reflects a broader industry trend of outsourcing investment management to focus on holistic financial planning. Non-wrap mutual funds, which often charge upfront fees, are less appealing due to the rise of low-cost exchange-traded funds. While wrap programs offer convenience, they come with additional fees ranging from 1% to 3% of assets under management, potentially resulting in clients paying for two advisors. Broker-dealers are more likely to use wrap programs due to financial incentives. In a recent interview, a financial advisor discussed how wealth firms are handling revenue sharing in 2025. He mentioned that part of the revenue goes back to the broker-dealer as a fee, highlighting the economic dynamics at play in the industry.



Read more at Yahoo Finance: More advisors are ‘outsourcing’ some investment management