FSI Survey: Advisors Enter 2026 With Guarded Optimism and Growing Concerns

With interest rate uncertainty, federal debt concerns, unpredictable markets and an active policy landscape shaping the year ahead, FSI members are preparing for another stretch that will challenge their ability to adapt.

To better understand their expectations about what lies ahead, we surveyed more than 220 members during the first part of November. The responses point to a mix of guarded optimism and clear concerns. Respondents feel reasonably confident about markets, but they also see real pressure building around regulation, talent shortages, practice operations, and the growing role of private markets in client portfolios.

Economic Outlook: Guarded, but Not Gloomy

On the economy, respondents expressed somewhat mixed opinions, yet most have a positive view about the year ahead, even as public sentiment is a bit more downbeat. About two-thirds describe themselves as optimistic or somewhat optimistic. Roughly 15% fall on the pessimistic side and a notable share remains neutral. Across all sentiment categories, inflation and interest rates stand out as the top issues shaping client confidence levels.

Market Expectations for the Year Ahead 

Views on the markets follow a similar pattern. Most have an upbeat outlook, and despite a noticeable uptick in volatility when the survey was conducted, the majority expect the S&P 500 to deliver gains through 2026. Nearly 60% anticipate modest growth and another 10% expect more meaningful advances. About one in five foresees flat conditions and a smaller group expects a decline.

Still, concerns about a sudden drop persist. More than 80% report at least some level of worry about a sharp pullback in the next 12 months.

Regulatory and Legislative Pressures Take Center Stage 

Against this backdrop, regulatory pressure remains a major source of strain and continues to shape how firms allocate time and resources. Independent contractor protections (54%) are the top concern by a wide margin. Respondents also cited unclear rules, state-level fiduciary requirements and proposed taxes on financial services as the top areas that could further complicate operations. A smaller segment pointed to the growing amount of time required for compliance tasks and the pressure these obligations place on smaller practices. 

AI Adoption: Growing Interest Paired with Caution 

Technology is another area where firms are weighing opportunity and risk. Technological advancements continue to influence advisor workflows, yet many firms remain early in their adoption journey. About 20% are actively integrating AI across key functions. Most, however, are either experimenting (46%) or watching developments carefully from the sidelines (16%).

When asked where AI could add the most value, respondents highlighted client communications, portfolio research, compliance and planning support. Data privacy, oversight and accuracy remain the most significant barriers to implementing more AI-based tools within practices. 

Talent Shortages and Barriers to Entry 

Talent dynamics add another layer of complexity. The survey reaffirmed a long-running challenge: The shortage of advisor talent continues to weigh on firms of all sizes. Respondents say the biggest reasons young professionals hesitate to enter the field are misperceptions about the role (38%) and limited awareness of a clear career path (35%). For firms trying to recruit, finding qualified candidates and managing compensation costs remain the primary hurdles. Many also note that building a book of business has become increasingly difficult for new entrants, for a variety of reasons. 

Private Markets Continue to Gain Momentum 

Respondents also continue to see changes in client preferences. An uptick in interest in alternatives mirrors broader trends across wealth management. Nearly a third report rising client appetite for private credit, private equity, real estate and other alternative strategies. Most of the remainder say interest is holding steady. The solutions generating the most attention are private equity and REITs. Respondents cite diversification as the chief benefit of expanding retail access to private markets, while pointing to illiquidity, transparency and complexity as the key risks. 

Looking Toward 2026 

Viewed together, the survey results show an industry preparing for uncertainty while keeping its focus on client confidence and long-term planning. Professionals remain hopeful about market performance, yet realistic about the challenges tied to regulation, talent shortages and fast-moving developments in technology and product design. As 2026 approaches, they continue to balance these crosscurrents with resilience and a strong commitment to serving Main Street investors.