401(k) Real Talk Episode 170: October 8, 2025

Welcome to this week’s edition of 401(k) Real Talk, where Fred Barstein, contributing editor for WealthManagement.com’s RPA channel, reviews all of last week’s industry news and selects the five most important/interesting stories.

LinkedIn Poll: Who will win the World Series:

Worth reading/listening/noting:

Note: September Job Report Delayed

Read the full raw transcript below: 

Greetings & a warm welcome to this week’s edition of 401k Real Talk. This is Fred Barstein contributing editor at WealthManagement.com’s RPA omnichannel and CEO at TRAU, TPSU & 401kTV – I review all of this week’s stories and select the most important and interesting ones providing open honest and candid discussion you will not get anyway else. So let’s get real! 

FIRST STORY

In a move already sending shock waves throughout the financial services world, Merrill’s largest group by far with $129 bn based in Atlanta left the wire house to become independent known as OpenArc working through Dynasty and Schwab.

Related:401(k) Real Talk Episode 169: October 1, 2025

With 100 employees and 95 of the top 1000 companies as clients and majority owned by senior management with a minority stake by Dynasty which in turn has a minority interest by Schwab, Open Arc is well positioned through its stock option, employee benefits and retirement capabilities as well as wealth to leverage the convergence at the workplace.

As expected, Merrill filed a lawsuit but a judge refused to grant a restraining order.

Does the move say more about Merrill than the wire house model? A senior Open Arc exec stated that corporate clients have indicated that traditional brokerage models no longer meet the needs of their people.

Instantly one of the largest RIA firms, Open Arc may attract other wire house advisors or give them the courage to also go independent though most will still want that big check and move to another wire house.

Next story:

One of the original robo advisors started in 2008 with $88 billion AUM, 1.3 m customers and expected revenue of over $300m in 2026, Wealthfront has filed for an IPO.

In 2022, UBS agreed to buy Wealthfront for $1.4 bn on the heels of the $1bn acquisition of Personal Capital by Empower, but that deal quickly fell apart.

Related:401(k) Real Talk Episode 168: September 24, 2025

Unlike competitors like Betterment with $60bn AUM and estimated revenue close to $200m, Wealthfront does not work with human advisors. They see themselves as a tech company 1^st and may be able to leverage AI to meet the growing demand for advice which may in turn interest the public.

Next story:

While PE firms have seen their highest #/liquidity events in Q2 at @215 and $308 bn, the news is not entirely good.

Concerned about interest rates and the effect of tariffs, many firms have been willing to sell at discounted prices sitting on 30,000 companies waiting to be sold and 35% held for more than 6 years acquired when interest rates were lower.

PE has heavily invested in the DC world  – most recently StonePoint, which also owns Ascensus, bought into OneDigital; Madison Dearborn which also owns Great Gray repurchased the wealth and retirement assets from AON; and Aquiline is divesting Sageview at a discount. Other aggregators like Hub are owned by PE while Captrust and Creative Planning which is acquiring Sageview have taken minority interests. TPA firms continue to be acquired by PE owned entities.

The current #1 concern by PE firms? Fund raising which may be why many like Apollo, Blue Owl, iCapital and KKR are focusing on DC assets.

Related:401(k) Real Talk Episode 167: September 17, 2025

Next story:

Empower’s Ed Murphy is certainly not shy or afraid to make bold statements declaring recently in an interview with star WealthManagement reporter Alex Ortolani that his firm is on the hunt to buy a national RIA firm.

While still looking to acquire other record keepers, Empower’s focus after the MassMutual and Prudential deals seems to be on advisory firms buying personal Capital for $1 bn in 2021 which now has $100bn growing at 25% annually and 1000 advisors leveraging Empower’s 19m participants.

Adding a national RIA would only accelerate that growth though it might raise concerns by advisors that bring them the plans and look to leverage participants themselves.

FINALLY

Mark Twain once said that history doesn’t repeat itself but it often rhymes. Driven by consolidation and convergence, record keepers, asset managers and advisory firms are looking to re-bundle services reversing the unbundling of the DC industry over the past 25 years.

Read my recent WealthManagement.com/RPA column about how bundling service is more about owning the participants, not the plans, as the fee gap is widening.

And last but not least, this week’s LinkedIn poll asked: Which team will win the World Series? Most picked the Dodgers followed by the Yankees, Brewers and Blue Jays though after the 1^st 2 games with the Blue Jays, the Yankees seem over matched.

FINISH

So those were the most important stories from the past week. I listed a few others I thought were worth reading covering:

A final note: I usually cover the jobs reports at the beginning of each month as it affects how org’s view benefits like retirement plans but because of the government shutdown and the chaos caused by the firing of the BLS commissioner after a job report that Trump claimed was rigged to make him look bad, the September job report has been delayed. Trump’s initial nominee for BLS commissioner EJ Antoni has been withdrawn after bi-partisan concerns.

Please let me know if I missed anything or if you would like to comment. Otherwise I look forward to speaking to you next week on 401k Real Talk.