1. FPA of Georgia Bernie Clark Executive Vice President Advisor Services May 24, 2017
Compliance #0517-5UY

2. Representing $1.3 trillion in assets*
Advisor Services
1,800 Schwab team members dedicated to custody, trading and operations…
Over 7,000 advisors
Representing $1.3 trillion in assets*
*Data as of Q Advisor Services total assets includes RBS and Corporate Brokerage Retirement Services (CBRS) assets and excludes “retail assets” resulting from Schwab Advisor Network and Advisor Source.

3. Today’s Discussion: The Evolving Role of the Advisor
Economics/Financial Models
The Future of Advisory Relationships
Differentiation
Next Generation Succession Planning
Advocacy

4. Economics & Financial Models
Profile of an RIA Firm
Key Metrics of a $250M+ firm from our
2016 Benchmarking Study1:
Average account size: $1.60M
Number of clients: 350
Year-end AUM: $588M
Standardized operating margin: 27.2%
Age of firm: 21 years
5-year organic growth CAGR2: 5.4%
CAGRs
9.7% Schwab ASI Assets
9.1% RIA Industry Assets
4.7% S&P 500
Note: CAGR is the compound annual growth rate from Chart indexed to 2006 levels. Source: Charles Schwab; Yahoo Finance.
Schwab Advisor Services Institutional (ASI) assets exclude Retirement Business Services (RBS) assets. Excludes “retail assets” resulting from Schwab Advisor Network® (SAN) and Advisor Source
2016 is a preliminary Schwab estimate assuming 2016 RIA market growth was in line with ASI asset growth
Excludes dividend yield
2016 RIA Benchmarking Study from Charles Schwab.
1. Median results for all firms with $250M or more in AUM, unless otherwise noted RIA Benchmarking Study from Charles Schwab, fielded January to March, Study contains self-reported data from 1,128 firms. Participant firms represent various sizes and business models categorized into 12 peer groups — 7 wealth manager groups and 5 money manager groups, by AUM size.
2. Organic growth from net asset flows is the change in a firm’s assets from new, existing, and lost clients before investment performance is taken into account, and it excludes the growth from acquisition or divestitures, and from advisors joining or leaving. 4

5. The Future of Advisory Relationships
External forces…
will drive internal change.
Technology
Fee structure
Specialty Services
Millennials
Digital Experience
Talent

6. Differentiation Relationship management Value-added services
More personalized and differentiated.
Potential for building trust and loyalty.
Personal interaction and assistance to manage aspects of a client’s financial life
Relationship management
Financial planning, estate planning, charitable giving, tax planning, etc.
Value-added services
Asset allocation, portfolio construction, ongoing portfolio management
Investment management
More easily automated and replicated.
Potential for commoditization.

7. Next Generation Succession Planning
Many Advisors are Nearing Retirement
38.5% of advisors are transitioning within 10 years
39.4% of assets are transitioning within 10 years
Chart Source: U.S. RIA Marketplace 2016, Cerulli Associates

8. Advisor & Industry Advocacy
for Advisors
RIA industry awareness and talent development
RIA Talent Advantage™
University Grants
RIA Student Intern Program
Investment in advocacy advertising campaign
Executive Leadership Program
Washington DC advocacy
Department of Labor Fiduciary Rule
Anti-money laundering
Ongoing outreach

9. Q&A

10. Appendix & Disclosures
Slide 2
Note: Data as of Q Advisor Services total assets includes RBS and Corporate Brokerage Retirement Services (CBRS) assets and excludes “retail assets” resulting from Schwab Advisor Network and Advisor Source. Schwab Retirement Business Services are provided by Charles Schwab Bank and Charles Schwab & Co., Inc., separate but affiliated companies and subsidiaries of The Charles Schwab Corporation. Brokerage products and services are offered by Charles Schwab & Co., Inc. (Member SIPC). Charles Schwab Bank provides trust, custody and deposit products and services with respect to retirement plans.
Slide 4
Note: CAGR is the compound annual growth rate from Chart indexed to 2006 levels. Source: Charles Schwab; Yahoo Finance.
1. Schwab Advisor Services Institutional (ASI) assets exclude Retirement Business Services (RBS) assets. Excludes “retail assets” resulting from Schwab Advisor Network® (SAN) and Advisor Source.
is a preliminary Schwab estimate assuming 2016 RIA market growth was in line with ASI asset growth.
3. Excludes dividend yield.
Metrics Source: 2016 RIA Benchmarking Study from Charles Schwab.
1. Median results for all firms with $250M or more in AUM, unless otherwise noted RIA Benchmarking Study from Charles Schwab, fielded January to March, Study contains self-reported data from 1,128 firms. Participant firms represent various sizes and business models categorized into 12 peer groups — 7 wealth manager groups and 5 money manager groups, by AUM size.
2. Organic growth from net asset flows is the change in a firm’s assets from new, existing, and lost clients before investment performance is taken into account, and it excludes the growth from acquisition or divestitures, and from advisors joining or leaving.
Slide 6
Source: Automated Investing MKT 2015, Charles Schwab.
Slide 7
Chart Source: U.S. RIA Marketplace 2016, Cerulli Associates