Attempts to describe the shortage of next-generation financial advisors veer toward the dramatic: “Desperate Need,” Forbes reports. “Firms Struggle,” CNBC declares. “Dangerous Stockbroker Shortage Threatens America,” warns The Wall Street Journal.
This isn’t entirely media hysteria. Statistics and anecdotal evidence corroborate the reasons for alarm. Both Pershing and Cerulli Associates researchers have produced studies in recent years showing that since 2004, more advisors are leaving the profession due to retirements than those joining it. Compounding the shortage, firms are having trouble replacing those who are departing and only a small minority of new advisor trainees — perhaps as few as 10% — remain with the firm that recruited them for more than four years.
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