The ClientWise Blog

For Financial Advisors, the Grass is NOT Always Greener

Posted by Chris Holman on Apr 24, 2012, 11:27:00 AM

Earlier this month, we highlighted seven blogs that we enjoy, and are written by financial advisors, “7 Financial Advisory Blogs that Rock”. One of these was the “Wall Street Journal Financial Advisor Blog”.

In yesterday’s WSJ blog post, comments from Mindy Diamond were highlighted. Many of you will know that Mindy Diamond is the CEO of Diamond Consultants, one of the nation’s prominent financial advisor recruiting firms.

In her comments, Diamond underscored 3 reasons as to why financial advisors should NOT go independent:


  • Not interested in being an entrepreneur. Top-performing advisors, even those who work within a large wirehouse, have many “self-starter” qualities. However, being an independent financial advisor requires using all of one’s entrepreneurial muscles from head to toe. Diamond’s observation is that not all financial advisors are interested, or willing, to attend to the day-to-day granularity of running their own business.


  • Financial advisors who regularly access firm-specific, specialized resources. Many of the wirehouses have developed layers of specialized resources. Some financial advisors successfully integrate these specialized resources into their own wealth management model. For example, financial advisors who specialize in working with executives with concentrated stock positions may want to utilize the corporate services functions that many of the wirehouses have built. Alternatively, a financial advisor who focuses on the high net worth space may want to leverage the personal trust and estate administration services of their firm. That isn’t to say that, as an independent, a financial advisor couldn’t build great partnerships with other trusted advisors, but there is probably a different level of accountability with an internal resource.


  • Money left on the table. Finally, there might be significant financial reasons that complicate the decision to go independent, i.e. walking away from a significant amount of unvested deferred comp, repayment of a loan to the broker-dealer, etc.


From a coaching perspective, ClientWise is completely agnostic with regard to what model our clients choose, and are comfortable with. We have worked with many advisors who have made the transition, from wirehouse to independent…and vice versa. The key to success for top-performing advisors is to function within a model that best supports their own vision of the wealth management practice that they have built, or are building.

By the way, if you are a financial advisor who is considering a transition from your current firm, and would like to access coaching as an objective resource in reaching your decsion, I would encourage you to call our director of business development, Trey Schalk. He can be reached at (914) 269-0060.

Finally, feel free to download the complimentary ClientWise Learning Tool below, "Are you ready for a coach?"


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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Business and Operations Management, Entrepreneurs