At a glance
- Consultants say they should not wait for the June 30 deadline to begin.
- Brad Wales, founder of Transition to RIA, said Fidelity has allowed enough time to complete a three-phase move in the roughly eight months leading to June 30.
- Advisors have to keep running the day-to-day business while carrying what he called a very large project on top of it.
Advisors at firms below Fidelity's new $100 million custody minimum face months of repapering to move client accounts. Consultants say they should not wait for the June 30 deadline to begin. Fidelity told custody clients under $100 million they had until June 2027 to move, according to Financial Planning.
Brad Wales, founder of Transition to RIA, said Fidelity has allowed enough time to complete a three-phase move in the roughly eight months leading to June 30. Financial Planning reported the timeline Oct. 9. The first two phases could each be finished in weeks, while the last stretches several months as advisors track down straggler clients.
"But the problem is you still have your proverbial day job," Wales said. Advisors have to keep running the day-to-day business while carrying what he called a very large project on top of it.
Fidelity has said the number of firms likely affected runs into the hundreds. Most already hold client assets with more than one custodian, Wales said. Firms using software from Advyzon, Orion or Black Diamond Wealth Solutions run systems built to work across a range of custodians. "They're not having to change anything with Advyzon," Wales said. "They're just having to change what the account is actually held."
Some firms holding assets at Fidelity can transfer enough in to meet the $100 million minimum, Wales said. Firms that already run a second custodian, or that can move assets in to clear the minimum, are working a smaller project with the same deadline.
As Financial Planning reported Oct. 2, Fidelity offered no fee option to stay, a departure from earlier minimum increases that Michael Kitces called bizarre.
Sole-custodian exits take the longest
For sole-custodian advisors, the first step is assessing custodial-service providers. With roughly a dozen to choose from, that vetting could take months, according to the report. Many of Fidelity's rivals also carry minimum-asset requirements that advisors under $100 million are unlikely to meet, Wales said.
Reported by the Recruiting & transitions desk from Financial Planning. Published . Corrections