Advisors ultimately choose to leave their current firm for one of two reasons: (1) they can make more money elsewhere or (2) their current firm is no longer meeting the needs of their practice. More often than not, we find advisors looking for a new home due to the latter. However, on the other side of that coin is the main reason we see advisors stay at a firm they are not happy with – they are afraid of all the unknowns.
There are several reasons why you may begin to explore your other options. The primary reasons we suggest looking around include:
- Your fees are increasing without a substantial increase in support.
It’s common for Broker/Dealers to increase the fees their advisors pay every few years. However, we have heard from many advisors in recent years that it seems every time the fees they incur go up, their access to support and technology actually goes down. We encourage you to assess the fees you are paying to do business, along with the level of support you receive, on a regular basis (every 3-5 years) and compare it with the competition.
- The product offerings at your current firm don’t address your client’s needs.
Your primary objective is to do what’s best for your clients – that’s why you do what you do. If you find there are carriers or products you want to be able to offer to your clients, but can’t, on a regular basis, there are likely other firms you can affiliate with that will widen the scope of your offerings.
- You find yourself spending too much time on non-revenue generating activities.
Take one week to jot down how you are dividing up your workday. How much of that time is either spent with clients or preparing for client meetings? If you’re like many of the advisors we talk to, almost half your time could be spent on other activities. The double-edged sword to owning your own practice is having to wear too many hats. If you’d like to take off some of those hats, it’s time to explore firms that have in-house support teams to take on several of those non-revenue generating tasks.
- Your Broker/Dealer is for sale.
Finally, it’s no secret that our industry is experiencing extreme consolidation. The biggest Broker/Dealers are getting even bigger by acquiring any smaller B/Ds that are still in existence. The economies of scale can be a benefit to the advisors who affiliate with those B/Ds, but we find that a lot of advisors move to whatever B/D acquires their current firm without taking the time to explore what else is out there. Even if you’re set to get a sizeable check in the transition, you may be surprised to find out what you can get elsewhere.
If any of these major events struck a chord with you, we’d encourage you to explore at least three potential new firms that you could call your forever firm. We would welcome the opportunity to tell you more about ours during a confidential discussion. Simply email explore@fppathways.com or call 248-663-4776.