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We are pleased to provide financial advisors with our perspective on poignant themes surfacing through our Advisor Research Collaborative (ARC) with our Cerulli Connections newsletter. Join ARC to contribute to this body of research and read on for Cerulli’s outlook for the advisory industry this year and beyond.

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ADVISORS

Top 10 Trends to Watch in 2025


01 | Wealth Transfer

Cerulli anticipates that assets totaling approximately $124 trillion will transfer intergenerationally through 2048, including $108 trillion going directly to heirs. With trillions of dollars projected to change hands on an annual basis, it is critical for advisory practices to review their wealth and estate planning service offerings in order to maximize post-transfer asset retention and provide the highest levels of service to quality clients.

02 | Separately Managed Accounts

Despite the buzz around direct indexing and customized investment solutions, separately managed accounts (SMAs) remain underutilized, as most advisors (54%) do not allocate the vehicle to client portfolios. SMAs can be a source of differentiation for advisors looking to offer greater personalization to clients and can minimize taxes through algorithmic tax optimization.

03 | Alternative Investment Models

Models of alternatives—where multiple funds, including semi-liquid alternatives, are combined into a single-asset-class model—have hit the market in 2024. Meanwhile, asset managers are tirelessly working to incorporate semi-liquid alternatives into multi-asset-class models. In turn, models are continuing to fill gaps in product lineups that allow advisors to target the unique needs of individual clients, especially those in higher asset tiers.

04 | Retail Access to Alternative Investments

Private capital markets continue to grow and play a great role in the U.S. economy as providers of capital. A variety of private capital exposures are being made available to advisors via structures that offer enhanced liquidity (e.g., interval funds, non-traded BDCs—and eventually, possibly even ETFs). It will take advisors tremendous effort to identify the asset classes and structures that serve their clients best—but, in 2025, helping clients access such product will increasingly become table stakes.

05 | Advisor Retirement

Over the next decade, more than 100,000 advisors are expected to retire, representing 37.4% of the industry headcount and 41.4% of total assets. With advisor headcount remaining essentially flat year over year and with more than one-quarter (26%) of advisors transitioning to retirement within 10 years being unsure of their succession plan, this will be a compelling trend to watch develop.

06 | Alternative Investments in Retirement Plan Lineups

All over the financial press, public-private partnerships are gaining steam (e.g., KKR/Cap Group). The defined contribution (DC) industry is fueled by inertia, and, therefore, functions such as daily liquidity and valuation methodology need to be standardized before widespread implementation of alternative investment options on plan menus can begin. Adoption of alternative investments will depend largely on plan sponsor size, which affects how products are disseminated.

07 | Broader Opportunities for Independence

As the RIA channels mature and advisor routes to independence become well-worn, resources for breakaway advisors have improved and become more plentiful. Many large, acquisitive RIAs continue to find success tailoring their focus toward advisors with specific backgrounds and service demands. Sell-side merger and acquisition (M&A) consulting has also grown over the past years as a valuable tool available to independent advisors looking for more support ahead of a transition.

08 | B/D Consolidation

The broker/dealer (B/D) marketplace has experienced ongoing consolidation, driven by the growing need for technology investments to effectively retain and support advisors, as firms pursue scale and growth through M&A. In 2023, the top-25 firms by assets under management (AUM) controlled 93% of B/D channel assets. Changes in B/D service and support will give advisors more opportunities to take advantage of efficiencies afforded by scale, or otherwise spur them to move toward independence.

09 | Responsible Investing/ESG Product

In 2025, the U.S. Securities and Exchange Commission (SEC) is continuing its efforts to standardize climate and sustainability reporting, significantly altering the environmental, social, and governance (ESG) landscape. Improved disclosure requirements enhance data consistency, making it easier to assess companies' social and environmental risks. This change is fostering greater transparency and accountability across U.S. markets.

10 | WealthTech

Effective use of technology within an advisor’s practice is continuing to increase in importance for three reasons: 1) advisors face increasing constraints on their time as they focus on growth without a subsequent increase in human capital; 2) the industry is struggling to recruit, train, and develop the next generation of advisor talent, and 3) client expectations regarding the range of services received are increasing.

Cerulli Advisor Research Collaborative

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Cerulli’s Advisor Research Collaborative (ARC) is the largest financial advisor research network in the U.S. For over 30 years, it has served as the foundation for Cerulli’s strategic intelligence on the U.S. wealth management marketplace. More than 2,000 financial advisors regularly participate in the Collaborative to benefit from shared insights.

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