Wealth Management

Opting to switch broker dealers is typically a last-resort decision, stirring discomfort among advisors. The mere contemplation of change signifies a threshold of considerable discomfort. There are various catalysts for this discomfort, with the top three reasons for advisors to consider such a move descending as follows:

 

  1. Advisors increasingly require practice management and marketing aid from broker/dealers as they expand their practices and seek to optimize efficiency.
  2. Advisors prioritize broker/dealers offering innovative technology solutions such as electronic signatures and paperless office systems.
  3. Advisors explore broker/dealers offering higher payouts, lower expenses, and more favorable administrative fees to maximize profitability.



Despite the challenges, the landscape of over 500 Independent Broker/Dealers presents ample opportunities for advisors seeking change, with the potential for greener pastures elsewhere.


Finsum: Tech advancements are offering new advisors a plethora of reasons to consider a transition because they can improve both efficiency and client relationships. 

There has been widespread adoption of separately managed accounts starting in the mid  2000s. The rationale for managing fixed income assets in this manner remains pertinent today: transparency, flexibility, transaction cost management, and active management are paramount in fixed-income investing. 

SMAs offer tailored portfolio management to meet clients’ fixed-income objectives, including tax management, income production, and specific investment restrictions, setting them apart from pooled vehicles like mutual funds and ETFs. The growth in SMAs for fixed income has been remarkable, with assets in SMA municipal fixed-income investments expanding from $100 billion in 2008 to $718 billion by Q2 2023, according to Citi Research. 

The advantages of SMAs, such as enhanced customization and efficiency, have fueled their increasing adoption by investors seeking precise control and personalized solutions in managing their fixed-income portfolios.


Finsum: Tailored financial products deliver a more personalized client experience and SMAs provide an avenue to improved relationships.

 

Raymond James conducted its annual survey of retired financial advisors to figure out how happy they are and the factors behind their responses. A consistent lesson is that succession planning is essential to feeling content in retirement. 

Many advisors recommend getting immediately started with succession planning, even if it is many years down the road. An important step is to identify a successor who you believe can continue effectively serving your clients. 

Some steps in this process include surveying your network to identify potential candidates, conducting interviews, and spending time with them to gauge if they are the right fit. It can also be helpful to get input from your firm’s management team.

Once you’ve identified a successor, the next step is to inform your clients. In the survey, 74% of advisors mentioned that communicating with clients was important in preparing for retirement. While these conversations can be initially awkward and uncomfortable, they will ultimately deepen the client-advisor relationship and increase the odds of a successful transition for your clients.

The final step is getting mentally and psychologically prepared for retirement. This can mean planning the final stage of their career, whether it means an immediate exit, a transition period, or a consulting role. Retiring advisors have considerable experience and wisdom that they can still share with their successors, especially during stressful situations.


Finsum: Raymond James conducts an annual survey of retired advisors to find out how many are happy and why. One of the major takeaways is the importance of proactive and effective succession planning.

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