Page 22 - Investment Advisor June 2023

Cover Story

Wealth Management in 2023:

Charting a New Path

Recent industry reports and views from insiders

reveal a complex web of trends influencing the sector,

its many challenges and ample opportunities.

By Jeff Berman, Michael S. Fischer and Melanie Waddell

ver the past year, the number of broker-dealers has continued to fall. Meanwhile, the
headcount of dual-registered representatives (with BDs and registered investment advisors)
Okeeps rising. But while RIAs are capturing more financial professionals and client assets today,
this channel is also experiencing rapid consolidation — which is actually driving down the total number
of RIA firms, despite the fact that the industry is seeing many new ones form to address market needs.
With these trends in mind, some industry experts say the current growth of the RIA channel is leading
to further sophistication in the advice business. Others point to technology as a significant driver of both
this growth and the industry confluence of BDs and RIAs.
As this convergence continues, firms will have to find more ways to stand out from the crowd, industry
veterans stress. This could mean the further expansion of tax services and lending, for example, as well as
more complex income planning.
Overall, industry players now face some difficult strategic decisions around the multiple and layered
changes in the market for financial advice. Their choices will likely lead to more diversification in the
type of firms, as well as in the menu of products and services that advisors offer their clients — so they
can further differentiate themselves in a rapidly shifting and highly competitive field.

20 Investment AdvIsor June 2023 | ThinkAdvisor.com