In the financial advisory industry, the concept of independence has gained significant traction in recent years. Increasing numbers of advisors are choosing to break free from the traditional constraints and embrace a new era of possibilities. As a mid-career advisor, I made the leap to independence after spending more than a decade at leading wirehouses. This transition has empowered me to design my practice according to my own vision and has opened up a world of opportunities for growth and creativity.
Independence offers a range of benefits that can transform the way financial advisors serve their clients and run their businesses. One of the key advantages is the ability to execute your own unique vision. While wirehouses provide a solid foundation for advisors starting their careers, independence allows those who dare to think outside the box to truly flourish.
Unlike traditional wirehouses, independence offers the freedom to engage in proactive social media and marketing campaigns. Advisors can leverage various tools and resources to build their businesses creatively. This includes not only establishing their brand but also utilizing the right communication channels to connect meaningfully with other advisors. These same resources can also be deployed to reach prospective clients, expanding the horizons of the business even further.
Independence Also Means Coming Together
It is crucial to note that independence does not mean advisors have to go it alone. The industry offers options that allow advisors to thrive within a supportive team environment while tapping into previously underutilized skills. Experienced advisors, including those preparing for succession, often find themselves ready for independence or seeking to elevate their practices to the next level.
Advisors in pre-retirement mode can make a phased transition into retirement by aligning with independent advisors who still have a long career runway ahead. With about 103,000 advisors planning to retire by 2030, with 26% unsure of their succession plans according to Cerulli Associates in 2022, there are reasons to plan ahead. By joining forces with other advisors, experienced professionals can leverage their collective skills and expertise, creating a synergistic environment that benefits both advisors and their clients. However, it is essential for advisors to ensure that the home office program they choose provides dedicated personnel who can support the success of such partnerships or teams.
Moreover, mid-career advisors should not disregard the possibility of independence if they possess the traits necessary to think outside the box and build their businesses creatively. Independence or joining a team of independent advisors can be an ideal path for these forward-thinking individuals, regardless of their age or career stage.
Greater Control, Flexibility, Opportunities
For me personally, becoming an independent advisor was a momentous decision. Leaving behind a six-person team managing $600 million in client assets, I was driven by the vision of building my practice according to my own aspirations. Now that I have embraced independence, I take deliberate actions every day to build a team that complements my skills and background, fostering an environment that aligns with my values and objectives.
In a landscape where more advisors are subject to heightened scrutiny, often due to being affiliated with bank-owned brokerages, independence provides an alternative. In the independent channel, you can find firms that aren’t bank-owned, but rather, offer the resources of a globally recognized investment bank that elevates their businesses. While access to institutional resources is undoubtedly important, the ability to differentiate oneself from the competition is equally crucial. Independence provides the platform for advisors to find their unique focus and stand out in the industry.
The journey to independence may not be suitable for every financial advisor. However, for those seeking greater control, flexibility and the opportunity to unleash their creativity, independence can be a game-changer. By embracing independence, financial advisors can design their practices, nurture client relationships and shape their future on their terms. In doing so, they pave the way for growth, innovation and success within the industry.
David Hsieh is a financial advisor with Beacon Wealth Advisory at Stifel Independent Advisors.