Four Reasons Advisors Change Firms

Advisors who change their broker/dealer affiliation are typically leaving what they consider less-than-stellar career situations for a firm that will increase both their professional success and personal happiness. If you feel like your firm could be doing more for you, take a look at the four most common reasons advisors leave their broker/dealers, and consider which of them apply to you: culture, compensation, control and challenge.

Culture

• An advisor may be pursuing or want to pursue a niche market, targeting clients based on their lifestyles or investable assets, for instance.
• These advisors need a firm that will support such an endeavor through sophisticated technology, marketing support or targeted services.
• They may be dissatisfied with their firm’s culture due to the effects of a broker/dealer merger or acquisition.
• Some advisors join independent broker/dealers or smaller regional firms because they want more control over their careers instead of feeling like just another number at a large wirehouse.

Compensation

• An advisor may feel that their commissions or fees fail to meet their expectations because of a subpar work environment.
• These advisors may believe that their firms, teams or supervisors are not supportive enough, thus limiting their full earning potential.
• Most leave their current firms in pursuit of higher payouts, front money, signing bonuses, improved employee benefits, the ability to sell their books of business, or other forms of compensation.

Control

• Some advisors may want more flexibility in the types of financial products they can offer clients.
• Others may not want to be restricted to a certain geographic area.
• Some may feel they deserve to own their books of business, since they – not their firms – have built those relationships.
• They may also want the flexibility to establish a brand for their business that is independent from their firm’s brand.

Challenge

• Some advisors prefer the responsibility of running their own businesses.
• They want to handle all their administrative and managerial tasks, even choosing their office space and furniture.
• Usually, only firms that facilitate truly independent advisor affiliations allow this.
• There are advisors who may want or need more one-on-one time with their clients, and their current work environments – especially in cases where firms insist on pushing certain products – can impair such efforts.