Fidelity gives sub-$100M RIAs until June 2027 to find a custodian

Fidelity Investments has told registered investment advisers that they must keep at least $100 million in client assets on its custody platform or leave, and the firm is applying that threshold to existing custody clients as well as new ones, a spokesperson confirmed to AdvisorHub. Affected firms have until June 30, 2027, to comply or, in the spokesperson's words, discontinue their custodial relationship with Fidelity.

The minimum counts assets held at Fidelity, not a firm's total AUM, which means an adviser running $400 million who keeps $70 million of it at Fidelity is, by this measure, a $70 million relationship. Firms that spread assets across two or three custodians for client redundancy, or because a legacy book arrived with its own history, are the ones most likely to read the memo twice. AdvisorHub, which first reported the notice, reviewed a copy posted on LinkedIn by Lake Avenue Financial founder and CEO Alex Chalekian, whose firm manages around $155 million according to its Form ADV — above the Fidelity threshold on total assets, though the report does not say how much sits at Fidelity. He said the move reinforced his decision to custody client assets mainly with Altruist, and wrote that he had a feeling the decision by Fidelity is going to backfire.

Fidelity has not said how many firms received the notice nor when the minimum for new firms took effect. The spokesperson framed the extension to existing clients as a consistency measure, and said the firm has committed to giving firms time to evaluate their options; a person familiar with the move said Fidelity has no immediate plans to raise the minimum further.

For an adviser under the line, the decision comes down to four line items, only one of which is the custody fee.

The first is platform pricing at the firm's asset level. A book of $60 million to $90 million generates a revenue pool that most established custodians price on a schedule built for larger relationships — the same schedule that produced the minimum in the first place. Advisers should expect tiered and negotiated pricing rather than published rates, and should test the numbers against the share of the book that actually moves, not the whole book.

The second is conversion mechanics. Moving client accounts between custodians is an operational project measured in months for a small firm with no project manager: account re-papering, cost-basis transfer, standing instructions, recurring distributions, and the handful of assets that arrive in kind only sometimes. The deadline sits at the end of a runway that a firm of ten or fewer employees should be sizing now rather than in the first quarter of 2027.

The third is who is left at Fidelity. Whether the minimum applies to RIAs that reach the platform through introducing brokers remains unanswered; Fidelity did not immediately say whether it extends to that channel. That matters because Savvy Wealth uses Fidelity's National Financial Services for clearing, execution and custody and plans to begin onboarding external RIAs in early-to-mid 2027, and WAD's records show Savvy has been active on the deal side through September. An adviser whose own assets sit under a larger firm's umbrella, or who joined a platform specifically because of that clearing arrangement, needs a direct answer from Fidelity rather than a reading of a memo addressed to someone else.

The fourth is the arithmetic of the minimum itself, and it cuts in two directions. A firm sitting at $95 million has an obvious option the memo does not advertise: bring another $5 million of client assets to Fidelity. Few advisors keep a spare $5 million in a drawer, but a firm with a pipeline, a rollover calendar, or assets held at a second custodian it would rather consolidate has a genuine path to compliance that costs nothing in transition work. The same math is a trap for a firm at $40 million, where the required growth is a different business.

The firms without minimums have already started saying so. Altruist CEO Jason Wenk, responding to Chalekian's post, said it should be a great first half of 2027 for Altruist and asked whether a $250 million minimum could follow. That is a competitor's question, not a fact, and the source of it is a CEO with an interest in the answer; Fidelity's stated position is that it has no immediate plans to move the number. Wenk's firm is itself in motion — Vanguard agreed in August to acquire Altruist — and as this publication has argued, custody choice has become a technology bet as much as a pricing one, with Altruist's AI lead measured in years and switching firms already choosing sides.

Devon Klumb, director of sales at Betterment Advisor Solutions, wrote on LinkedIn that the minimum looks like a play to get more from the firms who have clients elsewhere, and noted Betterment does not impose one. That is the second half of the sub-$100 million pitch: no floor, plus a claim about what the floor is for. A firm evaluating Betterment or Altruist on the strength of a competitor's minimum is choosing a custodian for a reason that will not exist in 2028. The operational questions — conversion support, cost basis handling, trading and service coverage for a book of that size — are what the firm lives with after the deadline stops being news.

The wave of platform consolidation does not make that easier. Concurrent is retiring the Spire Investment Partners brand as advisor teams transition to its platform; the acquisition of a $5.4 billion RIA with roughly 30 advisor teams closed at the start of this month, and advisors there keep their own brands as independent contractors. Advisers below the Fidelity line who are also weighing a merger or a sale now have two clocks running: the custodian's deadline and a potential acquirer's transition schedule. The order in which those land is a negotiation, not a coincidence, and the firm that signs an acquisition agreement in the spring of 2027 with assets still sitting at Fidelity should know who bears the conversion cost before the letter is signed.

For an adviser with a book of $80 million and a decade of client relationships at Fidelity, the sequence is unromantic: get the firm's actual Fidelity-held asset figure in writing rather than estimating from total AUM; ask directly whether the firm's channel — introducing broker, RIA, or hybrid — is covered; price two alternatives at the real asset level and ask what the conversion would cost in staff time and client disruption; then decide whether the cheapest path is a new custodian or $5 million of new assets. The deadline is June 30, 2027, but the firms that move in the next two quarters will negotiate, and the ones that move in the second quarter of 2027 will accept what they are offered.

Fidelity's $100 million line is a portfolio decision about a custody book, and the advisers below it are being asked to become someone else's growth. Which of them end up at Altruist, Betterment, or a platform that has not yet made a minimum public is the open question the next two quarters will answer.