There comes a time in every professional’s career when they feel they’ve hit a ceiling; that the company they’re working at either doesn’t share the same vision or doesn’t possess adequate resources and structure to support their growth.
Luckily, advisors have an option that people in many industries do not: going independent. “Many advisors understand that their success flows from their own skills and abilities, not the resources and reputation of their dealer,” explains Christopher Ambridge, President, Transcend. “For these advisors, independence offers the freedom to control their destiny, retain more earnings and build equity in a business that could eventually be worth millions.”
Independent advisors also have the ability to implement a more client centric perspective, which enables them to solidify existing relationships and attract new clients by providing unbiased, trustworthy advice, together with a customized compensation structure. Independence also delivers something all advisors crave: control. “Autonomy is perhaps the biggest lure,” Ambridge says. “Independent advisors have an entrepreneurial spirit, want to control their own destiny and wish to create something special. They are free to create their own value proposition by migrating to the independent advisor model.”
Ambridge points out another reason why more Canadian clients are choosing to work with an independent advisor: they’ve lost faith and trust in the big name institutions and are seeking a more objective approach. “Clients may be happy with their advisors but mistrustful of large dealers or the industry as a whole,” he says. “Independence also eliminates the worry of the parent company being associated with a scandal. Clients who were once attracted by the name of a major dealer are now recoiling at the potential for conflicts of interest and negative publicity.”
As well as releasing the pressure to sell in-house products and enjoying more overall control, going independent can be extremely lucrative for a modern advisor. Ambridge gives the example of an advisor who is leaving money on the table by moving toward a fee based platform within the payout structure of a larger institution. “Advisors who transfer this same business model to an independent platform can, depending on how they manage expenses, have the opportunity to significantly increase their income,” he says. “Independent advisors are also building equity in their business and a successful independent firm may exceed 25% operating profit margin after fairly compensating the owners and meeting overhead expenses.”
For more information, please visit: https://transcend.ca/advisor/