Fidelity's $100 million custody cutoff opens a dispute over how many RIAs must leave

Fidelity's asset figure cannot settle the headcount. Less than 1% of about $5.8 trillion is less than $58 billion ^[17]. If AdvizorPro's count is right and every one of those firms holds under $100 million at Fidelity, their combined balances top out at $115 billion ^[18]. Fidelity's ceiling only requires them to average below about $50 million apiece ^[19]. Both claims can be true at once. They part on the client list: AdvizorPro's figure is about 35% of all the RIAs, family offices and broker/dealers Fidelity clears and custodies for ^[20], and Fidelity refuted it, according to WealthManagement.com ^[26].

For about a decade, Fidelity has charged firms with under $15 million a $2,500 quarterly fee ^[5]. That works out to $10,000 a year, or roughly 0.07% of assets for a firm sitting right at $15 million ^[21]. The smallest firms paid to stay ^[5]. Under the 2027 rule, a firm with less than $100 million on the platform cannot stay at any price ^[1]. Fidelity already had a way to price small relationships and chose a cutoff instead; WealthManagement.com placed the rule alongside Fidelity's other moves to push its custody business upmarket ^[16].

If Fidelity's few hundred is right, it is trimming a tail of small accounts that together hold under 1% of its assets ^[24]. If the Form ADV counts are closer, it is ending roughly one relationship in three for the same small share of assets ^[20]. Two separate Form ADV analyses landed near 1,000 or above ^[25][26]. The asset figure does not rule them out, so I'd put more weight on those counts than on an unquantified few hundred. The counter-case is that Fidelity holds the balances the rule measures, while the data providers work from public filings ^[1][25]. An exact count from Fidelity in the low hundreds would prove this view wrong.

Altruist, Axos, Betterment, Interactive Brokers and Schwab, the largest RIA custodian, all argued on social media and in the trade press that they could take in exiting advisors ^[7]. Schwab's raised minimums apply to its referral program, and it is also bidding for the departing firms' custody business ^[8][7]. The options are also changing: BNY Pershing is retiring Wove as a standalone platform and folding its technology into its broader wealth-solutions business, Wealth Management reported ^[10]. "We've never seen this many anti-RIA announcements," said Tim Welsh, founder of consultant Nexus Strategy ^[11].

"We recognize that change requires thoughtful planning, and Fidelity has committed to providing firms with time to evaluate their options," a Fidelity spokesperson said ^[2]. "To essentially terminate long-standing relationships with good clients, it's surprising and disappointing," said Dagan LaCorte, a managing member at L&L Partners Wealth Management, who has been with Fidelity for 20 years ^[13]. Stuart Ruff, founder of Ruff Choices Investment Management, has used Fidelity as a custodian for about 15 years and said he will likely have to switch next year ^[14]. He said he is nowhere near the $100 million line and never will be ^[15].