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10 Key Points Every Advisor Needs to Address When Considering a Move


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Knowing these before you start the decision-making process will help you make the right choice with the least amount of stress

I’ve written much about the decision-making process that an advisor goes through in order to determine if his firm is the one that will continue to serve him into the future. It occurred to me, though, that the most stressful time for an advisor who plans on jumping ship is the time “in between”—the time from deciding it’s time to go to the time one actually makes the leap.

  • What are the questions an advisor needs to ask of the prospective new firm(s)?
  • What are the things that a responsible steward for clients should be concerned about?
  • And, if faced with multiple offers from multiple suitors, how does an advisor ultimately choose the right new home?

Understanding what you need to know BEFORE you start the decision-making process is key to answers made from a state of calm, rather than the panic of pressure and time. Here is a 10-point list that will keep you focused on the right information.

1. Name brand

What will resonate the most with your clients, prospects and centers of influence? Has the brand been tarnished at all?

2. Capabilities

Can the prospective firm fully support your business? Do you do any type of niche business or specialized work for clients that might not be supported elsewhere? In-depth platform review is critical: Make sure that every aspect of your business is vetted—loan rates, private equity lock-ups, credit card capabilities, international capabilities, special arrangements regarding client fees, and any other “one off” agreements you might have in place.

3. Local and regional management

They are the faces of the firm, your champions and advocates, and will be your blockers and tacklers—how well-connected are they? What is their background? Do they see the world as you do? How well respected are they by the advisors who work for them and by senior leadership?

4. Senior leadership

Be sure you understand the direction, goals and vision of the firm. Where does the firm generate most of their revenue? Where will they invest the most? Will your niche business continue to be a strategic priority for them?

5. Transition deal and ongoing payo

How much of the overall deal is guaranteed? How much will you have to grow in order to hit all back-end bogeys? Will the firm reimburse all of your unvested deferred comp? Will it be replaced in cash or with a cliff vest? Can you negotiate any portion of the deal; that is, to be paid more up front, to have back end bonuses structured so that you will have the ability to earn the greatest percentage of bonus money in the years you are likely to generate the greatest amount of revenue? What will your payout be at this firm? What has been the firm’s history in changing advisor comp?

6. Support Staff/Expenses

How would this move impact your staff? Will your support staff be given a raise? Will you have to contribute to your staff comp? Will you be able to hire additional support as part of this move? Will the firm offer you marketing, travel and entertainment expense money, especially for the first year after the move? Will the firm reimburse you for attorney’s fees?

7. Growth

How will this firm help you to grow faster and more efficiently? What will they do to invest in you?

8. Succession planning

What kind of plan does the firm have in place for retiring advisors? How does that plan compare to your current firm and others? What sort of flexibility will the plan allow you in terms of how to choose your successor and how much you want to work when the time comes for you to exit the business?

9. References

Be sure to insist upon talking with other advisors that work for the firm, and who have similar businesses; that is, similar business mix, production level, asset base, and/or came from your old firm.

10. Instincts

And, last but definitively not least, go with your gut: Let your instincts guide you. After you have vetted all of the above, you will come to a point where you realize that it’s a jump ball between 1 or 2 firms. Absent a huge delta in transition economics or the ability to support your business, the final decision will come down to what feels the most right.

The decision to stay or go is a big one. No one should ever change firms unless that move can move the proverbial needle enough in terms of your ability to serve your clients, to be paid a fairer wage, and to live your best business life. Often there is leverage in being recruited that an advisor lacks when he has been a long-term employee and likely taken somewhat for granted. It doesn’t have to be that way. Keeping these 10 points in mind, asking the right questions and paying attention to the answers is key to ensuring the next step is the right one.

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