According to the latest findings from Schwab is Independent Advisor Outlook Study (IAOS), independent advisors are experiencing challenges in their businesses stemming from COVID-19 but remain confident in the industry’s continued long-term growth. The study was released today as independent advisors gathered virtually for Schwab IMPACT®, which celebrates its 30th anniversary this year.
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“Advice has never been more important than it is today”
More than 1,300 independent advisors responded to the study, fielded in August, and the overwhelming majority (91%) expect continued growth for their industry. Among the top growth drivers: preference for the independent model versus other models (64%) and robust platforms and technology that make it easier to go independent (20%).
“This year has challenged us as an industry and accelerated the pace of change, but independent advisors have demonstrated that they were made for this moment,” said Bernie Clark, executive vice president and head of Advisor Services. “At firms of all sizes, I have seen flexibility and resilience over these months of disruption and it all comes down to independent advisors’ unwavering focus on guiding and serving clients towards their goals no matter what life is throwing at them.”
While long-term optimism remains high, advisors have unquestionably felt an immediate impact from COVID-19 on their firms. While most advisors (82%) still expect growth this year, almost half (42%) expect lower growth in net new assets this year compared to original projections. The average expected growth rate in new assets by the end of 2020 is now 11%. Most growth (93%) will come from organic sources (existing and new-to-firm clients) versus inorganic growth (e.g., M&A activity).
