They’ve gone and done it again.

Starting next year, Charles Schwab, the largest custodian for independent advisors in the US, intends to raise the minimum asset level for clients eligible for referral to its Schwab Advisor Network to $5 million, up from the current threshold of just $2 million. The network, which connects investors seeking independent financial advice with pre-screened providers, “has evolved significantly since its launch more than 20 years ago, and this change reflects where the program is already headed,” a company representative said. More than half of SAN’s net flows come from clients with at least $10 million, the representative added.

It’s the second hike this year. In January, Schwab raised the minimum from $500,000 to $2 million, following more than two decades without a change. Schwab appears to be making SAN more exclusive, frustrating advisors who rely on it to build their client bases. “Many firms have built their entire growth engines on top of those referrals, and Schwab looks to be actively shrinking the program,” said Tim Welsh, founder of wealth management consultant Nexus Strategy.

Ch-ch-ch-ch-Changes

Schwab maintains it’s still committed to independent advisors. But that message gets murkier alongside Schwab’s push to expand its own workforce. The firm took out a full-page ad in The Wall Street Journal this month stating that it intends to hire thousands of new financial consultants. “They haven’t said it in so many words, but the implication is: ‘Anything under $5 million is ours,’” Welsh said. Still, Schwab remains a custodian advisors want to work with. “Their scope and scale are just staggering,” he said.

Other recent SAN changes include:

• Schwab doubled the minimum assets for firms participating in the program from $250 million to $500 million earlier this year.
• In 2025, Schwab raised the ongoing asset-based fee by 5%, to rates ranging from about 26 basis points on the first $2 million to 10.5 basis points above $10 million.

You Know Where You Are? The changes are unlikely to prompt advisors to change custodians, Welsh said. “It’s such a hard and disruptive process, particularly if you’re a $1 billion firm with a lot of clients,” he said. But RIAs could begin looking elsewhere for new-client referrals. “Everyone else is going to step into the business to offer referrals and it won’t just be custodians,” Welsh said. “They’ll create this whole new category for referrals, and that’s a good thing.”

Others believe Schwab’s moves were inevitable and that advisors should have developed their own brands and prospect pipelines. “RIAs who have been spoon-fed referrals over the years may now be forced to spend more on marketing,” said Edward Mahaffy, founder of ClientFirst Wealth, Legacy & Estate Planning. “Welcome to the jungle.”

Just like ABBA said, “Money, money, money, must be funny,” but it’s still where risk-averse retail investors are parking their wealth.

Retail investors have accumulated more than $3 trillion in money market funds, according to the Investment Company Institute. Money market funds, while not yielding the 5% that they were a few years ago, are still keeping pace with inflation, with a rate hovering around 3.5%. Concerns about equity volatility and geopolitical uncertainty are rife, and bonds aren’t looking too hot, with the Bloomberg US Aggregate Bond Index in the negative so far this year. That makes money market funds an obvious choice for conservative investors, said Eric Diton, president of The Wealth Alliance.

“There’s a lot of people out there who are scared … cash is not a bad place to be if you’re that person,” said Diton. “That’s a natural response to rising rates and falling bond prices.”

Cash In Your Chips

Diton pointed to the uncertainty around the artificial intelligence buildout as a reason for clients wanting to hold more cash. AI “is a game-changer, but there are three letters that I don’t think anyone could answer, and those three letters are ‘ROI,’” he said. No one truly knows whether the return on investment will match the capital expenditure of the buildout, and “when there’s uncertainty, people like holding some cash,” Diton said.

Beyond holding more cash, Diton is making sure that his clients’ investments are not overexposed to the AI trade. “As people found out in 2002, if you make that concentrated bet and you end up being wrong, it could take you, in the case of the Nasdaq, 15 years to just get back to even,” said Diton. “A lot of people don’t have that kind of time.”

Money market funds have been a popular choice. Among the $3.1 trillion that retail investors have funneled into the products:

• Assets in government money market funds increased last week to $1.98 trillion.
• Tax-exempt fund assets increased to $136.98 billion, while prime money market fund assets decreased to $991.97 billion.

Smoke and Mirrors. Since financial advisors only look at the cash in the brokerage account, they don’t normally see how much money the client has in their regular checking and savings accounts. But now that money markets have a more attractive yield than in decades past, clients may be moving money previously held in cash to a money market funds. “To the advisor, it looks as if the client is holding a larger percentage of their assets in cash, but they haven’t actually changed their cash allocation,” said Gary Zimmerman, founder of the fintech platform Max. “They just moved it from one place to another.”

Maybe two isn’t always better than one.

Goldman Sachs consolidated its alts businesses into one alternative investments platform last month, targeting wealthy clients who want more access to private markets and secondaries. The announcement came days after Goldman’s earnings call for the second quarter of 2026, which showed higher-than-expected earnings per share and record revenue growth. It’s the latest initiative by a major bank in the alternatives space; last fall, Merrill Wealth Management and Bank of America launched their own alts platform, specifically for clients with a net worth of at least $50 million.

“Goldman combining their secondary [markets] business into this new platform and providing a way for investors to get some liquidity makes a lot of sense,” said Loren Fox, director of research at Fuse Research Network. “There are other platforms out there that enable that kind of liquidity in the secondary market, but if you’re already a client at Goldman Sachs, why not?”

Ultra-Interested

It’s no secret that firms are increasingly eyeing their high-net-worth and ultra-high-net-worth clientele, with increasing numbers of offerings meant specifically for them. The former group is also starting to require as many services as the latter, placing pressure on RIAs and wirehouses to become one-stop shops. “At some point firms that are already serving high-net-worth and ultra-high-net-worth investors have to figure out: ‘How can we add more differentiation?’” Fox said. “If you’re Goldman Sachs, you’re thinking: ‘What makes us different from JPMorgan Private Bank or Bessemer Trust?’” The move may also make logistical sense, Fox added, since having the bank’s secondary business and private market liquidity business in one unit may “increase efficiencies” and drive “cross-fertilization” between the two.

Goldman is also likely trying to maintain its competitive edge in the market:

• Morgan Stanley’s alts platform, which has been around since 1977, now holds over $300 billion in client assets.
• Fidelity launched its alternative investments platform in 2013, and it has since grown to more than $50 billion in AUM.

Trickled Pink. Another primary draw is simply strong client demand. A recent survey found that over 70% of Roth IRA investors said they turned to self-directed investing because they wanted to invest in assets that traditional plans did not allow (i.e., alts). As smaller investors get more exposure to private markets, Fox said it’s going to have a “trickle-up effect,” so that high-net-worth clients will be more interested in exclusive-access vehicles like secondaries and direct investments.

“The industry is moving toward a wide variety of vehicles to broaden investment into private markets,” Fox said. “[Goldman’s alts consolidation] will not just ride that wave, but also help strengthen it.”