Why the $5-10M market provides growth potential for advisors, financial institutions

US households with $5 million to under $10 million in investable assets is growing and evolving, offering a lucrative growth market for advisors and financial institutions, according to a new report.

These households are not only financially sophisticated, but also highly engaged investors who actively manage and move their money across multiple financial institutions. And it’s a significant cohort with 1.8 million households controlling $14.4 trillion in investable assets, with accounts at multiple stores (brokerage, banking and retirement firms) with 19% having six or more.

Hearts & Wallets’ latest report, The Market for Households with $5M to under $10M Investable Assets: Attitudes and Competitive Buying Patterns, draws from their expansive IQ™ Database of over 120 million data points.

It highlights a group of investors who are confident, informed, and increasingly interested in income generation and technology-driven financial advice. These households are more often in pre-retirement or earlier life stages compared to two years ago, and they display a high degree of comfort with market volatility.

Nearly all of them (98%) know their portfolio allocations by asset class—up sharply from 70% in 2015.  These investors are showing a shift in preference toward ETFs, now ranking among their top three most frequently owned products, surpassing individual bonds for the first time.

Fewer households in the cohort report high allocations to SMAs with more reporting higher allocations to ETFs and to cash, whether in checking accounts or core brokerage money market funds.

Pricing transparency has improved dramatically too with just 5% of this group not knowing what they pay their primary or secondary financial providers, a significant contrast to the national average of 25%. Their perception of services being expensive is rising.

Around 40% move substantial amounts of money between firms annually, with nearly one in five maintaining accounts at six or more institutions. They also tend to be independent traders, and many hold bullish views on artificial intelligence and the value of technology in financial services.

Firms competing for these households’ attention must be proactive and transparent and Fidelity leads both in overall reach and wallet share, followed by Vanguard, BlackRock/iShares, Morgan Stanley, and Charles Schwab.

Vanguard stands out on customer trust and likelihood to recommend, while Bank of America Merrill leads in helping customers understand how it earns money. E*TRADE ranks highest on customer intent to invest more.

“Loyalty and cross-selling metrics are key to understanding future market shifts within this segment,” says Beth Krettecos, Hearts & Wallets Subject Matter Expert. “Firms that understand their financial attitudes, goals, and behaviors will be better positioned to earn trust and sustain strong relationships.”