Former wirehouse financial advisors who have gone independent say that the jump is worth it, but the landing is easier with the right mindset, preparation for a range of new responsibilities and a willingness to let a client go.
Leasha Flammio-Watson, who left Wells Fargo to join Ameriprise's independent channel in Melbourne, Fla., two years ago, says that other advisors thinking of making a move should know their client relationships inside and out.
"I chose not to take it personally when a client chose to stay behind because I knew that if I had a relationship then the client would either eventually choose to re-engage or at least stay in communication," says Flammio-Watson, who brought over more than 90% of her book of business within the first 90 days.
Transitioning advisors should also be ready for a lot of client meetings to explain the move, advisors say.
"The greatest hurdle for us was explaining why we wanted to go independent and not be with a large firm," says Trey Mahan.
Last month, he left J.P. Morgan with Gregory Snider to form South Texas Wealth Management, which is affiliated with Raymond James Financial Services in New Braunsfel, Texas. The team brought over approximately $141 million in assets under management when it made the move, according to Raymond James.
Mahan says that their clients, mostly retired small-business owners, understood why they wanted to run their own firm.
But part of the process was explaining that "yes, we are an independent firm, but we have the backing of a large firm that can provide us services like cybersecurity and that sort of thing,” he says.
TRULY INDEPENDENT
Transitioning advisors also need to be ready for many new responsibilities.
"We worked in the bank channel, and you take for granted a lot of things like health insurance or finding a place to rent or doing payroll. I think that scares off a lot of people [from going independent]," Mahan says.
Steve Dudash encountered similar situations when he left Merrill Lynch to become president of IHT Wealth Management, an independent Chicago firm affiliated with LPL Financial.
"For any guy leaving a wirehouse, they need to know that a significant portion of their time will be spent running the business," says Dudash.
But there is a wealth of resources available to help transitioning advisors, from in-house coaches at independent broker-dealers to outside consulting firms, independent advisors say.
Flammio-Watson says that she used Ameriprise coaches to help with areas such as marketing.
For former Merrill Lynch advisor Jay Ezzell, going independent meant adopting an identity for his three-advisor team.
"Coming out of a wirehouse you already have a story told for you," Ezzell says, who went independent as the Ezzell-Conklin Group in Folsom, Calif., with HighTower last year.
Of course, each transition is unique, and advisors are bound to hit a few bumps, independent advisors say.
"Yes, we had a learning curve, but it was a good learning curve," Dudash says.
This story is part of a 30-day series on going independent.
