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Of Myths and Moving 2022

Every day, some mentors choose to wear the new jersey or take the leap of freedom. And in an industry that has exploded with options in recent years, it’s no surprise that the movement is breaking records.

Yet, despite all this activity, advisors who are either on the verge of change or are curious about their options, share some common concerns. So about two decades ago, I started writing this regular installment of To dispel the “myths” that can block a consultant’s plans to realize their full potential.

So what are the most common misconceptions that consultants share these days?

1. “Not a good choice for large wirehouse teams.”

As the competition for top talent intensifies, most firms up their game in a way like never before.

For example, there is often an assumption that “all wirehouses are equal,” yet in recent years, these firms have expanded their suite of offerings to the ultra- and high-net-worth clients and consultants they serve. has done. With advanced multi-family office resources, access to private investment opportunities, and more, they are investing heavily in their platforms to provide more variation.

Similarly, regional firms such as RBC, Raymond James and Stifel are hitting it out of the park with an expanded footprint, competitive transition packages and less bureaucratic and more consultant-focused culture.

It is boutique firms—such as First Republic Wealth Management and Rockefeller Capital Management—that have been the hottest landing spots for top talent. Their models offer a more exclusive experience, combining the support and infrastructure of a larger firm with greater freedom and control.

And, of course, freedom is more appealing than ever. The growing ecosystem to scaffold Breakaway provides access to capital, turnkey support and everything a consultant needs to build and run a successful business.

2. “I’m a senior advisor and have less than 10 years to retire considering my firm’s retire-in-place program, and I think it’s the only smart way to monetize my life’s work Is.”

For advisors who expect to retire completely from their firms, this is an easy way to monetize their life’s work, while the next generation of advisors stands to grow their asset base.

But both stakeholders are finding that the expanding landscape offers more than one avenue for monetization and succession. For example, senior advisors who are not quite ready to retire nor feel that their firm is the right legacy for their business, often choose to switch firms and subsequently retire-in to the new firm. -Place signing programs -essentially run once and monetize twice.

Alternatively, there are teams that choose to take the leap to independence and devise their own succession plan – selling the business to the next generation or the open market.

Either way, we recommend that seniors and the next generation of advisors make decisions with their eyes open. Senior advisors often find too late that they are bound by their firm beyond the life of the agreement, while successors lose their optionality and ability to become free agents.

3. “If I walk, my firm will follow me.”

The reality is that those who don’t give their firms a reason to be concerned usually participate with little to worry about. In the rare cases where legal action is taken, it is because a consultant cut corners or did not follow a lawyer’s advice.

There is no doubt that while broker protocol moves provide the greatest amount of cover, non-protocol moves are successfully executed every day. But it is important to follow the strict advice of a legal advisor. And in the case of a non-protocol move, be careful to follow the non-solicitation rules outlined in the employment agreement.

4. “If I move to a firm that does not have a bank affiliation, how will I meet the credit needs of my customers?”

Certainly, advisors working in bank-owned firms have an easy way to meet all lending requirements. Yet smart firms not affiliated with a bank have leveled the playing field by offering advisors lending through third-party banks. Firms like Rockefeller have actually found an advantage by offering more options, allowing advisors to shop for the best rates and options to best suit their clients’ needs.

Similarly, independent advisors have found that the ability to “shop the street” has opened up a new world of choice and price competition for their clients – which many consider to be one of the most attractive features of the advisory model.

5. “I’m reluctant to move because I’m worried customers won’t follow me.”

This is always one of the most common concerns among consultants contemplating change. In fact, the apprehension is valid for those who do not have strong relationships with their customers. Still, the reality is that it has become far more exclusive for clients to develop long-term relationships with their trusted advisors – not the firm they represent.

For consultants who have always put their clients’ interests first, from our experience, 80% to 90% of clients they wanted to take with them moved to a new firm.

Before any move, consultants need to assess their relationship and book to determine whether concerns about portability are legitimate. Review any non-portable positions, and be aware of how leaving them behind will impact the overall business.

Whether you are considering a move or not, it is important to always know that there are alternatives and to make decisions based on facts, not myths; Those misunderstandings can create obstacles to achieving great success.

Mindy Diamond is the CEO of Diamond Consultants in Morristown, NJ, a nationally recognized boutique search and consulting firm in the financial services industry.

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