Long Term Path to Independent

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Oct 26, 2008 3:37 pm

For those guys who have made the jump from wirehouse to independent firm, what are some tips for us newer guys to have our businesses structured in case we ever want to make the switch. 


I've heard from some wirehouse guys they cannot make the switch as they have too much of their practice locked into the firm.  Not sure how that happened, but I want to avoid it if possible.
Oct 26, 2008 6:13 pm

Stocks, ETFs, and mutual funds move easily.  SMAs are tougher because everyone has a different list.

Oct 26, 2008 6:53 pm

Make sure your clients associate you with who is providing the expertise, and try to make sure they know that the name on the sign doesn't matter as much as the name on the door..



Most independent firm can add different money managers as long as you ask them.

Oct 28, 2008 11:10 pm

I concur with NOVA might be somewhat problematic because of the SMA issue.  Squash is right on the money (no pun intended!)  Another potentially problematic area may involve working within a team and whether you have signed any formal team agreements. 

 
These agreements, according to a study I read may restrict the Advisors ability to go independent because of the specific language in the team agreement.  Such Team agreements, regardless of whether your firm is a member of The Protocol should be explored with an attorney proficient in such matters would be my suggestion.  
 
 
According to PRNewswire, Denver, October 27:  ...Manis adds, "Another concern we are hearing is that BofA will be pulling Merrill out of the Protocol agreement. If it's true it'll throw
fuel on this fire."

The Protocol agreement is made of over 50 broker dealers and RIAs to allow for brokers to move to another signatory firm without the fear of a TRO (temporary restraining order) if the broker adheres to rules limiting the amount of the customer information they take.

Nov 25, 2008 12:14 am

You are the business, not the firm you are with.  Most likely, you have annuities that are under water without cdsc.  They are old generation with no living benefits.  Change them to new ones (not proprietary ones) if appropriate for the client, or to wrap accounts or straight brokerage.  Use the market downturn to get this going.   You will discover how well you did for clients, get to know them better and provide solid ongoing advice they need.  More than likely, your objectivity will make you more portable as well.  Took me 3 years to do this.

Nov 25, 2008 9:43 am

Just my $.02:
Build your business the most efficient way possible for the firm you're at now. Trying to plan for a future in a different system will just end up being an excuse for why you fail before you ever get there. you're setting your whole career up using "avoidance behavior". First, it'll be that you can't build the business you really want until you get indy, then it'll be that you can't get indy until you work off your last "transition" check, or whatever. Infinite "looking over the fence" or performing "Due Dillegence" on other firms (a complete misuses of that term heard here all the time), are just things you do instead of building your business. Work in the NOW. Later will take care of itself.

Nov 25, 2008 10:48 am

If you are doing A or C share mutual funds, and plan on just using one fund family per client, open the account AT the fund company. Changing the broker of record (you at old firm to you at new firm) is SO much easier, faster, and cheaper than doing an ACAT.