Altruist eliminates software fees for RIAs

Altruist eliminates software fees for RIAs
Advisors who custody exclusively with Altruist will receive free software, while firms that work other custodians will get the first 100 accounts for free.
SEP 21, 2023

Altruist has played the latest card in its ongoing efforts to woo independent advisors to its asset custody platform.

The Los Angeles-based company previously charged registered investment advisors $1 per account per month to use its portfolio management software. On Thursday, the firm announced it would waive this fee completely for advisors who custody entirely with Altruist. Advisors who work with other custodians will receive their first 100 accounts for free and be subject to the $1-per-account-per-month fee for the rest of their accounts.

While it may not sound like much, the move could certainly move the needle for firms considering Altruist as a destination for certain client accounts, said Zach Hubbard, director of financial planning and participant engagement at Green Spring Advisors.

“Looking at our offering specifically tailored towards wealth builders (those without assets to qualify for traditional advisor services), every dollar counts toward increasing margins on those clients and expanding our ability to serve more clients in that service tier,” Hubbard said in an email. “We haven’t officially made the switch to Altruist yet, but this definitely furthers their case.”

The move makes independent financial advice better, more affordable and accessible by eliminating what is often the most expensive part of an RIA’s tech stack, said Marc Greenberg, Altruist’s chief financial officer. For advisors spending between $40 and $70 per account every year on portfolio accounting software, the move could save thousands of dollars.

“Software and platform fees can become prohibitive to growth for large and fast-growing firms,” Greenberg said. “We are happy to offer a solution with scalable economics while simultaneously freeing up resources for more important things like client service, marketing, and operational efficiency.”

While eliminating fees is often a sign that a technology company is struggling to attract users, Greenberg denied that is the case at Altruist. The success of its own custody and clearing platform, which Altruist launched in March after severing ties with Apex Fintech Solutions, allows the company to offer its software for free, he said.

Read next: RIA software review

“We don't want to discourage advisors from offering accounts with no minimums — translating their advice to all interested consumers,” Greenberg said in an email.

Altruist has quickly grown as a challenger in the custody and clearing market once dominated by Charles Schwab Advisor Services, Fidelity Institutional and BNY Mellon Pershing. Altruist has raised $290 million in funding, including a $112 million round in April, to offer an alternative to independent advisors, especially those unhappy about the merger between Schwab and TD Ameritrade.

In March, Altruist acquired Shareholders Services Group, which brought 1,600 RIAs to its platform. The deal pushed the number of firms Altruist serves past 3,000, making it the third-largest custodian in terms of RIAs served, behind Fidelity and Schwab.

Luxury real estate market counting on lower rates to unlock supply

Latest News

Advisor moves: LPL adds $425M Evermark Investment Partners, $300M Merril Lynch group hops to Ameriprise
Advisor moves: LPL adds $425M Evermark Investment Partners, $300M Merril Lynch group hops to Ameriprise

LPL's latest addition, a San Diego team defecting from RBC, represents a milestone for the broker-dealer giant's Strategic Wealth model for wirehouse breakaways.

Senate tax bill stalls as hardliners balk at changes
Senate tax bill stalls as hardliners balk at changes

The new legislative proposal, which includes more aggressive cuts to Medicaid and a lower SALT cap, threatens a goal of passing President Trump's tax-cut legislation by July 4.

Osaic snaps up $13.5B CW Advisors
Osaic snaps up $13.5B CW Advisors

The deal for the Audax-backed RIA based in Boston gives Osaic a strategic foothold to attract more advisors and clients across the wealth spectrum.

Senate wants changes to Trump’s tax bill; here’s what’s expected
Senate wants changes to Trump’s tax bill; here’s what’s expected

‘Revenge tax’ on foreign investors could be scrapped in new version.

CFTC’s regulatory pioneer Bagley dies aged 96
CFTC’s regulatory pioneer Bagley dies aged 96

Veteran legislator helped set the standard for derivatives regulation.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave