Value of Independence

Why Would a Financial Advisor Choose Independence?

Sheila Jamison answered this when the Jamison Financial Group chose to be independent, saying

Your decisions are based solely on your clients’ welfare, and no one shows up in your office later pressuring you to sell something else next time because it is better for the company.*

If you believe that you can do more for your clients by leaving a large wirehouse, consider the benefits independence brings. If you feel that your clients are being compromised for the greater good of your broker/dealer (b/d), then it’s time to find a better way. Moreover, she added

In the absence of all the meetings and other company busywork, I now have maybe two- or three-fold more time to devote strictly to my clients’ goals and needs. I go home feeling more energized and gratified. I like what I do for my clients.*

Working with an independent b/d can give you much more independence as an advisor. Freed from the pressure or requirements to sell your firm’s proprietary products, you can focus on what’s best for your clients – not for your managers. Additionally, superior independent b/d’s offer state-of-the-art technology. That makes your job even easier. This was true when we went independent over a decade ago and it’s true today.

If you’re strong in these areas, you should consider independence:

  • Do you have the skills and talents to act on your own?
  • Can you handle not being told what, when and how to advise your clients?
  • Do you have good business & financial skills?
  • Does your personal code of ethics override inclinations to “let someone else do it”?
  • Would you be comfortable without the restrictive wirehouse structure and administrative procedures?
  • Do you want to decide what you want and go for it?
  • Do you take pride in doing the best you can for your clients above all else?
  • Do you want to like – make that love – the image you see looking back at you in the mirror each morning? 

If you answered most of these “yes”, give it some serious consideration!

While you will discover many changes and benefits to affiliating with an independent b/d, some aspects of your wirehouse life do follow you. For example, there are FINRA and the SEC regulations. A good choice of independent b/d will get you one that provides compliance oversight to ensure you stay within the lines.

You may have some reluctance to go it completely alone. JFG was better prepared than most by Rich’s business experience. But Sheila still felt some concerns (e.g., office space, phone service, utilities, supplies, etc.). That’s only natural when starting a new venture, regardless of how well prepared you are. How did it turn out?

Other than being more tightly tied to the office, so far I don’t see a lot of cons. Most of the things I was concerned about never materialized.*

Further, for those who want some support in making the transition to independence, there are groups like ours who welcome new blood. Of course in our case, that is as long as that new blood is sincere in putting clients first and will work tirelessly toward that goal.

*Senior Market Advisor. 7:9, 2006.