Direct Indexing Minimum: How Much Do You Need?

Q: Is $100,000 enough for direct indexing?

Technically yes — Wealthfront and Schwab both start at $100K. Economically, it depends on your tax bracket. At the 23.8% combined LTCG+NIIT rate, $100K can generate modest positive net benefit. At the 15% rate, $100K rarely clears the fee hurdle. Most financial planners consider $250K–$500K the practical starting point where the math consistently works.

Q: What is the minimum for Parametric direct indexing?

Parametric (a Morgan Stanley subsidiary) is advisor-only and has no published retail minimum. In practice, most advisors require $250,000–$500,000 to make the platform economics work, with larger accounts receiving negotiated fee reductions. Parametric is not available directly to investors — you access it through a fee-only advisor who has a relationship with the platform.

Q: What is the minimum for Aperio (BlackRock) direct indexing?

Aperio, now part of BlackRock, is a high-end separately managed account platform with a practical minimum of $1 million or more. It is exclusively available through registered investment advisors. At scale, fees can be negotiated to 0.15–0.20%, making it attractive for accounts above $2M where advisor access to institutional pricing matters.

Q: Can I do direct indexing with $50,000?

Frec accepts accounts starting at $20,000, so technically yes. But at $50,000 the tax math is weak: at a 1.5% harvest rate and 0.09% fee (Frec), you're harvesting $750/year in losses against a $45 annual fee — the net benefit at the 23.8% rate is roughly $134/year. That's meaningful over decades but well below what larger accounts generate. If you're in the 15% LTCG bracket, $50K doesn't clear the fee hurdle at any platform.

The short answer: platforms accept accounts as small as $5,000–$20,000. The practical answer: the tax math doesn't reliably pay off until $250,000–$500,000 or more, depending on your tax bracket. Here's the breakdown by tier and bracket.

Two minimums to understand

When people ask "what's the minimum for direct indexing," they're usually asking one of two different questions:

Technical minimum — the lowest account balance a platform will accept
Economic minimum — the asset level where the tax-loss harvesting benefit reliably exceeds the fee premium over a cheap ETF

These numbers are very different. Platforms compete on the first one. Your financial plan depends on the second.

Why minimums exist: the stock-count math

Direct indexing works by holding the individual stocks inside an index — typically 200–500 names for a broad market strategy — instead of buying a single ETF that wraps them all. The TLH engine harvests losses from individual positions when they decline, even when the overall index is flat or rising.

For that to generate meaningful dollars, you need adequate position sizes. Consider what happens at different account levels with a 300-stock S&P 500 approximation:

Account size	Avg. position @ 300 stocks	Annual harvest @ 1.5%	Tax saved @ 23.8%¹
$50,000	$167	$750	$179
$100,000	$333	$1,500	$357
$250,000	$833	$3,750	$893
$500,000	$1,667	$7,500	$1,785
$1,000,000	$3,333	$15,000	$3,570
$2,000,000	$6,667	$30,000	$7,140

The harvest scales linearly with portfolio size. The fee premium — what you pay above a low-cost ETF — also scales linearly. Whether the math is net positive depends on those two lines crossing, which depends on your tax bracket.

Platform minimums by tier (2026)

Platform	Minimum	Annual fee	Access model	Notes
Fidelity FidFolios²	$5,000	0.35%	Retail self-serve	Simplified direct indexing; fewer stocks than institutional platforms
Frec³	$20,000	0.09%	Retail self-serve	Lowest fee; 500-stock implementation; no advisor coordination
Wealthfront⁴	$100,000	0.25%	Retail self-serve	Robo-advisor; DI replaces US equity ETF allocation
Schwab Personalized Indexing⁵	$100,000	0.40%	Retail + advisor	Schwab's in-house DI; fee steps down above $2M
Vanguard Personalized Indexing⁶	$250,000	Varies	Advisor-intermediated	Available through advisors using Vanguard's platform
Parametric⁷	~$250,000+	0.20–0.35% (negotiated)	Advisor-only	Morgan Stanley subsidiary; deepest customization; no retail access
Aperio (BlackRock)⁸	~$1,000,000+	0.15–0.25% (negotiated)	Advisor-only	High-end SMA; institutional pricing at scale; deep ESG/factor capability

Advisor-only doesn't mean more expensive. Parametric and Aperio fees are lower than retail platforms at the same dollar amount — the advisor negotiates on your behalf. At $1M on Parametric, you might pay 0.25% vs. Schwab's 0.40%. The catch: you're also paying the advisor's fee (typically 0.50–1.00%), so total cost is higher. The advisor earns it through multi-account coordination that retail platforms can't do.

The economic break-even: when does the math work?

Comparing tax benefit against fee premium at a 1.5% annual harvest rate. The fee premium column is the cost above a 0.04% total-market ETF.¹

Portfolio	Fee premium (0.25%)	Net benefit @ 23.8%⁹	Net benefit @ 15%	Net benefit @ 0%
$100,000	$250	+$107	−$25	−$250
$250,000	$625	+$268	−$63	−$625
$500,000	$1,250	+$535	−$125	−$1,250
$1,000,000	$2,500	+$1,070	−$250	−$2,500
$2,000,000	$5,000	+$2,140	−$500	−$5,000

The conclusion is stark: if you pay the 15% LTCG rate, direct indexing is nearly always a net cost, not a benefit, across every realistic portfolio size and fee tier. At 15%, you'd need to harvest 1.67% annually just to break even against a 0.25% fee premium — a threshold that requires consistently high single-stock volatility.

If you're in the 23.8% combined federal bracket (ordinary income above ~$533,400 single / ~$613,700 MFJ,⁹ and MAGI above $200K single / $250K MFJ for NIIT¹⁰), the math is net positive at virtually every portfolio size above $100K — though the dollar magnitude of the benefit is only meaningful above $250K.

State taxes shift the break-even down

California (13.3%), Oregon (9.9%), New York (10.9%), and New Jersey (10.75%) tax capital gains as ordinary income. A California resident in the top federal bracket faces a combined 37.1% marginal rate. At that rate, every $1,000 harvested saves $371 rather than $238 — reducing the portfolio-size break-even by roughly 35%. California investors in the 15% federal bracket can still clear the fee hurdle at $500K+ in some years.

What you can access at each tier

Under $100K: Self-serve only, marginal economics

Frec ($20K) and Fidelity FidFolios ($5K) are the only options. Neither offers multi-account coordination, advisor oversight, or wash-sale management across taxable and retirement accounts. For investors at this tier with high tax rates, Frec at 0.09% is the most fee-efficient option — but the dollar benefit remains modest until assets grow. Build the tax habit early and plan to migrate to a higher tier as assets accumulate.

$100K–$250K: Wealthfront and Schwab become viable

At $100K with a 23.8% effective LTCG+NIIT rate, Wealthfront (0.25%) generates roughly $107/year of positive net benefit. Schwab at 0.40% is net negative at this size. The practical advice: if you're in the top bracket with $100K–$200K in taxable, Wealthfront's fee tier makes it worth starting. Below that bracket, wait until you've grown assets or have a specific capital-gain event where a loss bank would help.

Neither platform coordinates across your IRA, Roth, or spouse's accounts — which is where a specialist advisor earns their fee.

$250K–$1M: Strong case, advisor adds value above $500K

At $500K in the 23.8% bracket, even Schwab's higher fee (0.40%) is net positive: roughly $285/year net benefit, accelerating as the portfolio grows. Self-serve platforms (Wealthfront, Schwab) work here. But if you have a concentrated stock position, RSU vesting events, K-1 income, or are planning a Roth conversion, advisor-coordinated direct indexing through Parametric can integrate TLH into your broader tax plan in ways a robo can't.

$1M+: Institutional platforms, negotiated fees, full tax integration

Above $1M, the economic case is strong at any fee tier. Aperio (BlackRock) becomes accessible and fees become negotiable — 0.20% or lower at $2M+ is achievable. The advisor relationship at this size pays for itself through multi-account wash-sale protection, income event coordination (business-sale proceeds, large RSU grants, IRA distributions), and estate planning integration (§1014 step-up strategy, DAF gifting). The calculator at $2M in a volatile year, combined with a California state tax rate, routinely produces $10K–$20K+ in annual after-tax value — well in excess of advisor fees.

What minimum is right for you?

The practical framework:

Top LTCG bracket (23.8%) with $100K–$250K taxable: Start with Wealthfront or Frec. Build the loss bank now. Migrate to advisor-coordinated platform when assets cross $500K or you have a major income event.
Top LTCG bracket with $500K+ taxable: Advisor-coordinated Parametric or a comparable platform justifies the fee, especially with concentrated positions, RSU income, or multi-account complexity.
Top LTCG bracket with $2M+ taxable: Full institutional access (Aperio, Parametric); negotiate fees; integrate with estate plan. This is where direct indexing's compounded advantage becomes a major wealth lever.
15% LTCG bracket: The math is nearly always negative. The exception: California and other high-tax states where the combined rate pushes past the break-even, or years with a large specific gain event to offset.
Concentated stock or major gain event: Minimum matters less. Even $250K in a DI loss engine can offset hundreds of thousands in a single-year capital gain. See the concentrated-stock framework.

Use the tax alpha calculator to model your specific situation, or the platform selector to see which provider fits your asset size and advisor preference.

Get matched with a direct indexing specialist

Tell us your taxable account size, income level, and situation — we match you with fee-only advisors who specialize in direct indexing at your asset tier. Free. No obligation.

Fee-only · No commissions · Free match · No obligation

Frequently asked questions

What is the minimum for direct indexing?

Platform minimums range from $5,000 (Fidelity FidFolios) to $1M+ (Aperio/BlackRock). The most widely used platforms — Wealthfront and Schwab — start at $100,000. Frec starts at $20,000. But the economic minimum — where TLH alpha reliably covers the fee premium — is $250K–$500K+ depending on your LTCG rate and state.

Is $100,000 enough for direct indexing?

Technically yes; Wealthfront and Schwab both start at $100K. Economically, it depends on your bracket. At the 23.8% combined LTCG+NIIT rate, $100K on Wealthfront (0.25% fee) generates roughly +$107/year of net benefit. At 15%, the same portfolio is a net negative. Most financial planners consider $250K–$500K the practical starting point where the math consistently works across bracket scenarios.

What is the minimum for Parametric direct indexing?

Parametric is advisor-only with no published retail minimum. In practice, most advisors require $250,000–$500,000 to make the platform economics work. Parametric is owned by Morgan Stanley (acquired through Eaton Vance) and accessed exclusively through registered investment advisors — not available directly to investors.

What is the minimum for Aperio (BlackRock) direct indexing?

Aperio, acquired by BlackRock in 2021, serves accounts of $1M+ through registered investment advisors. Fees are negotiated and can reach 0.15–0.20% at scale. It's the deepest customization platform (ESG, factor tilts, concentrated-position strategies) but only accessible through advisors with a BlackRock relationship.

Can I do direct indexing with $50,000?

Frec accepts accounts starting at $20,000, so $50K is technically above threshold. At a 1.5% harvest rate and 0.09% fee, you'd harvest ~$750/year in losses and owe $45 in fees — net tax benefit at 23.8% is roughly $134/year. Meaningful over a decade, but small relative to what $500K generates. If you're in the 15% bracket, $50K doesn't clear the fee hurdle at any platform.

How many stocks do you need for direct indexing to work?

Most platforms hold 200–500 individual stocks to replicate their target index and generate adequate TLH breadth. With fewer stocks, you lose diversification and harvesting opportunities. At $100K across 300 stocks, average position is ~$333. At $1M across 500 stocks, it's $2,000 — generating 6× more harvested dollars per percentage-point drawdown.

1.5% annual harvest rate used throughout is a conservative estimate for a broadly diversified direct-indexed portfolio in a normal volatility environment; actual harvest rates vary by year, market conditions, and platform algorithm. See Wealthfront research on stock-level tax-loss harvesting.
Fidelity FidFolios minimum and fee: Fidelity Direct Indexing overview.
Frec minimum ($20,000) and fee (0.09%): Frec direct indexing product page.
Wealthfront US Direct Indexing minimum ($100,000): Wealthfront support: minimum account sizes.
Schwab Personalized Indexing minimum ($100,000) and fee (0.40%): Schwab Personalized Indexing.
Vanguard Personalized Indexing minimum ($250,000): Vanguard advisor-facing product documentation.
Parametric: advisor-only, ~$250K+ in practice. Parametric Direct Indexing for wealth managers.
Aperio (BlackRock): advisor-only, $1M+ in practice. BlackRock Aperio tax-managed equity SMAs.
2026 LTCG bracket thresholds: 20% rate — single filers above ~$533,400, MFJ above ~$613,700. 3.8% NIIT (§1411) stacks on top for combined 23.8% rate. Source: CNBC, IRS 2026 capital gains thresholds; Tax Foundation 2026 brackets.
NIIT threshold ($200K single / $250K MFJ): IRC §1411, unchanged since 2013 — not indexed to inflation.

Platform minimums, fees, and tax thresholds verified as of May 2026. Platform terms change — confirm current minimums directly with each provider before opening an account.