Goldman Hands Off Personal Finance Unit to Creative Planning

Goldman Sachs is selling its personal finance business to investment adviser Creative Planning.

The deal, announced Monday (Aug. 28), comes one week after the news that Goldman was considering a sale of its personal finance management (PFM) business in its shift away from retailing banking.

According to a news release, Creative is one of the largest registered investment advisers (RIA) in the country, with more than 2,100 employees and $245 billion in assets under management and advisement.

“Creative’s wealth management teams will continue to have access to investment solutions and services from Goldman Sachs Asset Management as it builds a leading investment management platform,” the release said, noting that Creative last month forged a strategic custody relationship with Goldman Sachs Advisor Solutions (GSAS).

“Building on our existing custody relationship with Goldman Sachs Advisor Solutions, an expanded partnership with Goldman Sachs is a natural, strategic fit,” added Peter Mallouk, Creative Planning’s president and CEO.

“We welcome the talented advisers from PFM as we remain committed to being the leading adviser in the independent space. Together, we will offer HNW [high net worth] investors comprehensive planning and a broad set of solutions related to wealth and investment management.”

PYMNTS wrote last week that the Wall Street giant was considering a sale of its PFM operations. The company has argued that the unit represents a “very small” part of its overall wealth franchise, which has $1 trillion in assets under supervision. PFM, meanwhile, handles $29 billion.

“At Investor Day earlier this year, we laid out our plans to continue growing our private wealth, workplace (Ayco), the related private banking and lending business and Marcus Savings. We see outstanding opportunities to continue investing in these core businesses where we have a long-term track record of success,” a spokesperson told PYMNTS. 

On an earnings call in July, Goldman CEO David Solomon discussed the bank’s “pivot to narrow our consumer ambitions” as the company focuses attention on traditional investment banking and market-driven operations. 

As noted in this space, Goldman’s second-quarter earnings showed the ongoing impact of its retreat from Main Street banking, such as its move to sell its GreenSky business.

“While Wall Street may be parsing the details of revenue declines amid stock market volatility and deal-making turbulence — where investment banking-related, top-line contributions fell 20% — the company’s presentation materials detail efforts to reevaluate GreenSky and some added charge-offs in its consumer arm,” PYMNTS wrote.