Creative Planning Joins Fidelity Referral Program

What You Need to Know

The $300 billion RIA already has a referral relationship with Schwab; neither affects the fees paid by clients.
CEO Peter Mallouk, meanwhile, expects a third dominant custodian to emerge.
Creative Planning isn’t actively seeking a new custodian, Mallouk says.

Creative Planning recently joined Fidelity Investments’ client referral program, for which the Kansas-based RIA pays a $50,000 annual fee plus 0.10% of fixed income client assets and 0.25% of other client assets.

“We are thrilled to be part of the program,” Creative Planning President and CEO Peter Mallouk told ThinkAdvisor in an email last week, noting that his firm, which has more than $300 billion in assets under management and advisement, pays the same fees as the roughly 70 other firms that participate.

Through its participation in the Fidelity Wealth Advisor Solutions program, or WAS, Creative Planning receives referrals from Fidelity Personal and Workplace Advisors LLC, or FPWA, a registered investment advisor, and Fidelity Investments, the firm noted in a March 29 Form ADV brochure filed with the Securities and Exchange Commission.

Under the program, FPWA promotes Creative Planning, which pays fees for each referral received based on its AUM attributable to each referred client, the brochure says.

Creative Planning, not the client, pays the referral fee, the form states. The firm was selected to participate in the program “as a result of its other business relationships with FPWA and its affiliates, including Fidelity Brokerage Services LLC,” it says.

“Client fees are the same regardless of any source, whether it be Fidelity, Schwab, a tax firm or our other strategic partners,” Mallouk said in his email.

Creative Planning recommends establishing brokerage accounts with Charles Schwab & Co. or Fidelity Institutional Wealth Services, the brochure notes. The firm receives referrals from Schwab through its participation in the Schwab Advisor Network.

As as participant in Fidelity’s referral program, Creative Planning agreed not to solicit clients to transfer their brokerage accounts from affiliates of FPWA or establish brokerage accounts at other custodians for referred clients other than when its fiduciary duties would require it do so, the brochure says.