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Have you seen Nike’s new ad for the Olympics? It’s titled "Am I a Bad Person?" and it uses that question to tap into the winner's mentality in a unique and ultimately inspiring way. Actually, inspiring might not go far enough.  A few seconds into the ad you’ll likely start swaying restlessly and by the end, you’ll be looking for some raw meat to tear into.  

Voiced masterfully by Oscar winner Willem Dafoe, and featuring a dizzying montage of Nike’s seemingly unending roster of iconic athletes, the question the ad tackles is a big one –  is our desire to win a good thing?  The answer is a resounding “yes.”

At 3xEquity, we talk with hundreds of advisors each year who are curious about a move to a new broker-dealer. Inevitably, there are a handful who are stuck on the question: "Am I a bad person for wanting to switch to a new broker-dealer?" Some may have spent a significant portion of their career with their current firm. Others enjoy personal relationships with colleagues that feel tied to their current situation. Some are concerned about what others may think about their move to greener pastures. Nike takes the approach this way: "...if you don’t want to win, congrats. You’ve already lost."

Here are three reasons why advisors should embrace the idea of a move to a new broker-dealer without any guilt or hesitation.

First, for your clients. The opportunity to take advantage of new tools and technologies can significantly benefit those you serve. At a minimum, it can provide the chance to ask "what if" questions and address scenarios from the standpoint of "now that we have these tools available to us, I’d recommend we..." Your clients value the relationship they have with you (more than the brand name on the door), and our experience has shown that assets move and ties are strengthened after a transition.

Second, for you and your family. A move to a new broker-dealer likely comes with incentives that help advisors monetize their hard work and efforts in building their book. With BDs still competing for top talent, payments can reach as high as 300% of T12 (we are even hearing of one firm paying nearly 400%). Like a football player reaching free agency and getting their "career contract," this compensation is a recognition of the work you’ve done. In short, you’ve earned it. Ask yourself how this investment in you by your new BD can enhance the quality of life for you and your family.

Third, for the industry. Movement between firms creates competition that ultimately lifts all ships (or at least the ships that want to be lifted). Broker-dealers know they are competing for the best of the best and have been and will continue to make investments that will help them attract top talent. This means investments in technology, behind-the-scenes systems and personnel, and marketing. Competition in these areas forces others to react, and the industry as a whole moves forward. Although your goal shouldn’t be to make the industry better, consider it an added bonus.

"Our purpose in life is not to be perfect but to continuously strive to be better than we were yesterday."

For many advisors, considering a move to a new broker-dealer fits into that equation of striving to be better than we were yesterday. At 3xEquity, we help smooth the process, securing multiple offers for you and then guiding you through meetings and decisions, ultimately leveraging our insider knowledge to help you negotiate the biggest transition package possible. Get started today at 3xEquity.

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Choosing the right broker-dealer is a critical decision for financial advisors looking to transition their practice. Here are the key criteria to consider:

Reputation and Stability

   – Research the Broker-Dealer’s History: Look for a firm with a solid reputation and financial stability. Check their track record, client reviews, and industry standing.

   – Regulatory History: Investigate any regulatory actions or compliance issues. The Financial Industry Regulatory Authority (FINRA) can provide valuable information.

Support and Resources

   – Technology and Platforms: Evaluate the technology and platforms they offer. A user-friendly and robust tech infrastructure is essential for efficient practice management.

   – Marketing and Business Development: Assess the support provided for marketing and business development. Strong support can help you grow your client base and enhance your brand.

   – Training and Education: Ensure they offer ongoing training and education opportunities to help you stay current with industry trends and regulations.

Compensation and Fees

   – Compensation Structure: Understand the compensation structure...

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Hello and welcome to AdvisorTrends, 3xEquity’s podcast about all things related to advisor transitions and practice management. Today, we’re diving into the results of the recent J.D. Power Satisfaction Survey of financial advisors. This study sheds light on some intriguing trends in the wealth management industry, particularly the high rate of advisors being "in motion." Let's get started!

The financial advisory industry is currently experiencing a notable shift, with over one-third of advisors expressing openness to changing broker-dealers. This phenomenon, often referred to as being "in motion," signifies a readiness among advisors to move to firms offering better products, advanced technology, and enticing transition packages. The latest study by J.D. Power sheds light on the reasons behind this trend and its implications for the industry.

The J.D. Power study highlights several factors contributing to advisors' willingness to switch firms. Key among these are an aging sales force, industry consolidation, and challenges in prospecting new clients. These issues are making it increasingly difficult for firms to retain their advisors.

According to the survey, approximately 34% of employee advisors who are more than two years away from retirement are uncertain about staying with their current firm over the next one to two years. This sentiment is even more pronounced among independent advisors, with over 41% considering a change of firms.

Craig Martin, head of wealth and lending intelligence at J.D. Power, noted that "aggressive compensation offers, a promise of better technology or support, and flexible business models" are key factors tempting advisors to switch firms.

The study revealed interesting trends in satisfaction levels among different types of advisors. Employee advisors reported higher satisfaction levels compared to previous years, with their satisfaction score increasing by 49 points year-over-year to 637 on a 1,000-point scale. In contrast, independent advisors' satisfaction dropped by 15 points to 611.

“This is particularly noteworthy given that historically satisfaction scores among independent advisors have been higher than among employee advisors,” the study stated. This shift indicates a growing discontent among independent brokers, who have traditionally enjoyed higher satisfaction levels.

Another critical finding from the study is the perception of the direction in which firms are heading. Only 46% of independent brokers strongly agreed that their firm is headed in the right direction, a significant drop from 54% in 2023. This declining confidence further underscores the restlessness among independent advisors.

The challenge of retaining brokers is compounded by the fact that, since 2021, approximately half of those who indicated a likelihood of moving have indeed left their firms. This trend demonstrates the tangible impact of the factors driving advisors to consider new opportunities.

Employee firms, on the other hand, have been making strides in improving compensation metrics, technology, and support, which have likely contributed to the rise in satisfaction among employee advisors.

The financial advisory industry is at a crossroads, with a significant portion of advisors open to changing broker-dealers. As firms navigate the challenges of an aging sales force, industry consolidation, and client prospecting difficulties, the ability to offer competitive compensation, superior technology, and robust support will be crucial in retaining top talent.

Working with a transition consultant like 3x Equity can help smooth the process as well. Our experience in helping advisors transition safely and successfully as well as our ability to streamline the process and find your best fit, all without cost to you, make working with us a no-brainer. Get started today and control the conversation at 3xequity dot com.

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Are you confident that your practice is performing at its peak? It’s easy to assume when things are going well, there’s no room for improvement. However, even the most successful practices can have "unknown unknowns" – areas that aren't being focused on enough. A certified practice valuation can uncover these hidden opportunities for growth and efficiency.

At 3xEquity, we specialize in providing certified practice valuations for financial advisors, delivering unparalleled insights and actionable recommendations. Here’s why hundreds of advisors trust us each year:

$300 Cheaper Than the Other Guys
Our premium service comes without the hefty price tag. We provide our expert analysis at an affordable price point, ensuring you get the best value for your investment.

Delivered in Hours, Not Days
No more waiting around. You can have your certified valuation in as little as 48 hours, always faster than the competition and with no expediting fees.

23 Pages of Actionable Insights
Our custom report is more than just numbers; it’s a playbook for growth. With detailed analysis and clear recommendations, you’ll have everything you need to unlock new opportunities.

Personal Consultations Included In Our Price

When you secure your report today, you’ll receive two free consultations with one of our senior analysts. The first consultation ensures we gather the right information and understand your goals before the valuation. The second, after your report is delivered, helps turn the insights into actionable steps tailored to your practice.

Learn more at 3xEquity.com/

Today we’re diving into a topic that’s particularly timely: Why July is the best time to start your transition to a new broker-dealer.

As we settle into the sweet part of summer, many financial advisors might be contemplating a move but wondering when the best time to start those conversations is. Well, let me tell you, there may be no better time than right now. Let’s explore why July might just be the perfect month to embark on this important journey.

First and foremost, it’s the slow season. Many of your clients are on vacation, enjoying summer activities, or shuttling their kids to camps. This seasonal lull means your calendar is likely more open and flexible. With fewer client meetings and administrative tasks to handle, you have the rare opportunity to focus on your own professional development and strategic planning.

This period of relative calm allows you to dedicate significant time to researching potential new broker-dealers, assessing your options, and planning the logistics of your move. By taking advantage of this quieter time, you can ensure a more thoughtful and deliberate approach, covering all aspects of the transition with care.

Moreover, starting the transition process in July positions you for a seamless end-of-year move. For many advisors, timing their transition to align with the start of a new year is crucial. It allows for a clean break from the previous year’s business activities and sets the stage for a fresh start. By beginning the process now, you ensure there is ample time for a thorough search and review of all potential options, including home office visits and finalizing decisions before the fall, which typically brings a flurry of activity.

Another compelling reason to consider transitioning in July is the current market conditions. Broker-dealers are still offering significant premiums for top talent. These incentives are among the highest we’ve ever seen, presenting a lucrative opportunity for advisors who have strategically built their practices and are prepared for a transition. The financial benefits of making a move now can be substantial, providing a significant positive cash event that can enhance your financial standing and support future growth.

However, there’s no guarantee that these attractive offers will last indefinitely. Market conditions can change rapidly, and the competitive landscape for talent may shift. By acting now, you can capitalize on the current trend and secure the best possible terms for your transition, ensuring you’re not left at a disadvantage if the market conditions become less favorable in the future.

A well-timed transition can also enhance your ability to better serve your clients. By moving to a broker-dealer that offers superior technology, resources, and support, you can elevate the level of service you provide, ultimately benefiting your clients. This alignment of professional growth and client satisfaction underscores the strategic value of considering a move during this period.

Navigating a broker-dealer transition can be a complex and time-consuming process, which is why partnering with a transition consultant like 3xEquity is a smart choice. With extensive experience and a deep understanding of the industry, 3xEquity specializes in helping advisors manage every aspect of their transition, from securing multiple offers to negotiating the most favorable terms.

3xEquity’s comprehensive services are designed to alleviate the burden of the transition process. We handle the heavy lifting, allowing you to focus on your core responsibilities and client relationships. By leveraging our industry connections and expertise, 3xEquity ensures that you receive the best possible transition package, maximizing the financial and professional benefits of the move.

Best of all, 3xEquity provides these services at no cost to you. This commitment to delivering exceptional value without financial obligation makes 3xEquity an indispensable partner for any advisor considering a transition. Our support and guidance can make the difference between a challenging, stressful move and a smooth, successful transition.

In conclusion, July offers a unique and advantageous window for financial advisors considering a transition to a new broker-dealer. The slow season provides the necessary time and space to plan and execute a strategic move, while current market conditions present lucrative opportunities that may not last indefinitely. Partnering with a transition consultant like 3xEquity further enhances the likelihood of a successful transition, ensuring that you receive the best possible support and outcomes.

For those ready to explore their options and take the next step in their professional journey, now is the time to act. Visit 3xEquity dot com slash QS to learn more and get started on your transition today.

Thank you for tuning in to AdvisorTrends, 3xEquity’s podcast about all things related to advisor transitions and practice management. We hope you found this information valuable and that it helps you make the best decisions for your career. Don’t forget to check out our full library of prior podcasts available on Spotify. Until next time, stay strategic and proactive!

Election season is upon us and advisors may increasingly find themselves in uncomfortable territory.  Politics can easily seep into discussions, potentially affecting client relationships. Here’s how financial advisors can maintain professionalism and focus on their clients’ financial goals, irrespective of political differences.

The first step in keeping politics out of financial advising is setting a professional tone from the outset. Advisors should clarify that their primary role is to assist clients in achieving their financial objectives, not to discuss political views. Setting this boundary early on helps ensure that conversations remain focused on finances and not on the volatile realm of politics.

Despite best efforts, political topics may still arise, especially during election seasons. Here are some techniques to gracefully steer conversations back to financial matters:

Active listening is crucial in maintaining effective communication with clients. Here’s how advisors can practice active listening while not necessarily agreeing with the client’s political opinions:

Client: “I’m really worried about the upcoming election and how it might affect my investments. I think if [Candidate] wins, it could spell disaster for the markets.”

Advisor: “I understand your concerns; it’s a tense time for many. Let’s review your investment strategy to ensure it’s robust and diversified enough to withstand various political outcomes. Our goal is to keep your portfolio resilient no matter who is in office. Would you like to go over the risk management strategies we have in place?”

This approach acknowledges the client’s concern without engaging in political discussion and redirects the focus to financial planning.

For financial advisors, the key to navigating through the election season is to maintain professionalism, focus on clients’ financial goals, and establish a neutral ground where open and non-political discussions can flourish. By implementing these strategies, advisors can enhance their effectiveness and continue to provide value, no matter the political climate.

Curious about moving to a new broker-dealer?  3xEquity can help you secure multiple offers all while you remain 100% anonymous.  Get started today and control your career conversation.

Learn more at 3xEquity.com.

Summer often provides the opportunity for more downtime, and time on a beach or in a hammock is a great opportunity to pick up a book. For financial advisors, this downtime can be used strategically to enhance professional knowledge. Staying well-read helps advisors stay ahead of market trends and evolving client expectations, and engage in meaningful discussions with clients.

Here are some books this every financial advisor should consider adding to their reading list this summer.

“Slow Productivity” by Cal Newport

Cal Newport explores the concept of “slow productivity,” advocating for a focus on meaningful work and deep thinking over constant busyness. For financial advisors, adopting these principles can lead to more thoughtful, strategic decision-making and better client relationships. Newport’s ideas can help advisors manage their workload more effectively, prioritize high-impact activities, and ultimately provide better service to their clients.  Be sure to check out our recent blog post “Growing Your Practice The Cal Newport Way” for more insights.

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“Supercommunicators” by Charles Duhigg

Charles Duhigg’s “Supercommunicators” delves into the art and science of effective communication. Financial advisors who master these skills can build stronger relationships with clients, convey complex information more clearly, and influence decision-making more effectively. Duhigg’s insights into communication strategies can help advisors become more persuasive and empathetic, enhancing their ability to connect with and support their clients.

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“The Creative Act” by Rick Rubin

Rick Rubin, a renowned music producer, shares his insights on creativity and the process of creating something extraordinary. For financial advisors, fostering creativity can lead to more innovative solutions for clients’ financial challenges. Rubin’s approach to creativity can inspire advisors to think outside the box, develop unique investment strategies, and adapt to changing market conditions with a fresh perspective.

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“Sapiens: A Brief History of Humankind” by Yuval Noah Harari

While not a finance book per se, “Sapiens” offers a sweeping history of human evolution and society. Understanding the broad historical, cultural, and economic contexts in which financial markets operate can provide financial advisors with a deeper perspective on the forces that shape market trends and client behaviors. Harari’s exploration of human history can inspire advisors to think more holistically about the societal impacts of economic policies and market movements.

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“Nudge: Improving Decisions About Health, Wealth, and Happiness” by Richard H. Thaler and Cass R. Sunstein

Thaler and Sunstein explore how subtle “nudges” can influence behavior in positive ways. For financial advisors, this book provides practical insights into how to help clients make better financial decisions without heavy-handed intervention. By understanding the power of nudges, advisors can design strategies that encourage clients to save more, invest wisely, and plan for the future more effectively.

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“Antifragile: Things That Gain from Disorder” by Nassim Nicholas Taleb

Nassim Nicholas Taleb’s work focuses on how systems can thrive in the face of volatility and uncertainty. For financial advisors, understanding the concept of antifragility can lead to more resilient investment strategies and better risk management practices. Taleb’s insights are particularly relevant in today’s unpredictable economic environment, providing advisors with tools to help clients not only withstand but potentially benefit from market disruptions.

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“Factfulness: Ten Reasons We’re Wrong About the World – and Why Things Are Better Than You Think” by Hans Rosling

Hans Rosling challenges common misconceptions about global trends and data. For financial advisors, this book is a reminder of the importance of evidence-based decision-making. Advisors can use the insights from “Factfulness” to provide clients with a more optimistic and realistic view of global economic conditions, helping to counteract the often negative news cycle and its impact on investment decisions.

What’s on your summer reading list?  Share your picks in the comments section below.

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Like so many we’re caught up reading Cal Newport’s latest New York Times bestseller, “Slow Productivity.”  Subtitled, “The Lost Art of Accomplishment Without Burnout,” Newport proposes that a path exists for true life quality AND high-level achievement (and that running yourself into the ground doesn’t have to be an inevitability).  That kind of goal likely resonates with most financial advisors, as does much of his earlier work. We turned to a few of those books for clues and suggestions on how to grow your practice:

1. Embrace Deep Work For Unparalleled Focus

Principle: In “Deep Work,” Cal Newport emphasizes the importance of intense concentration on tasks that push your cognitive capabilities to their limit.

Application for Financial Advisors:

Principle: In “So Good They Can’t Ignore You,” Newport argues that developing rare and valuable skills is crucial for career success.

Application for Financial Advisors:

 2. Build Rare And Valuable Skills

Principle: In “So Good They Can’t Ignore You,” Newport argues that developing rare and valuable skills is crucial for career success.

Application for Financial Advisors:

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15 Things You Can’t Afford To Overlook When Considering A Move To A New Broker-Dealer

1. Who Owns the Client: The Advisor or the Broker-Dealer?

Understanding client ownership is crucial. If the broker-dealer owns the client relationships, transitioning away in the future might be more complicated. Ensure you have clarity on this to maintain control over your book of business.

2. When Was the Last Time the Broker-Dealer Changed the FA Compensation Plan?

Frequent changes to the compensation plan can indicate instability and affect your income. Investigate the history and frequency of these changes to ensure your financial stability.

3. How Many Practices Did the Broker-Dealer Bring In Over the Past Year?

A broker-dealer that successfully attracts and retains numerous practices may indicate a supportive environment. However, delve into why those practices moved and how well they have integrated.

4. How Successful Have Prior FAs Been in Bringing Over Their Assets to the New Broker-Dealer?

The ability of financial advisors to transfer the majority of their assets can speak volumes about the broker-dealer’s support and the ease of transition. This metric is vital for assessing potential disruptions to your business.

5. How Long Has the Current CEO Been in Their Position?

Stability in leadership often translates to stability within the company. A long-tenured CEO may indicate consistent vision and strategy, which can be beneficial for your long-term plans.

6. What Was the Most Recent Enhancement the Broker-Dealer Made to Improve the FA Platform?

Continuous improvement of the FA platform suggests a commitment to providing advisors with the best tools and resources. Look for tangible improvements that can directly benefit your practice.

7. Has There Been a Recent Platform Improvement for Clients?

Client-facing improvements can enhance your service offering and client satisfaction. Ask about recent upgrades and how they impact the client experience.

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Transparency and integrity play an outsized role in the perception of financial advisors. But as we know, things happen.  The U4 disclosure form, which outlines an advisor's disciplinary history, can play a critical role in establishing (or diminishing) trust and credibility with clients. Negative entries or "dings" on this form can create hurdles when advisors seek to move to new broker-dealer firms. Understanding these impacts and the methods available to mitigate their effects is essential for career progression.

Career Implications: Negative entries on a U4 can be a red flag for potential broker-dealers, affecting an advisor’s ability to switch firms. Such dings might suggest a history of regulatory issues or client disputes, making it challenging for advisors to find favorable positions. The impact extends beyond initial hiring prospects; it can also influence an advisor's ability to negotiate terms or even attract and retain clients under new broker-dealer affiliations.

Client Relationships: Clients often review an advisor's BrokerCheck profile, which includes U4 disclosures, to evaluate their trustworthiness and professionalism. Significant dings can erode client confidence and loyalty, potentially leading to a loss of business when transitioning between firms. Advisors must be proactive in addressing these entries to maintain strong client relationships.

Exploring Options with Transition Consultants: Transition consultants, like 3xEquity, provide invaluable assistance to advisors facing U4 challenges. These professionals help assess the impact of U4 dings and explore strategic options for mitigating their effects. Their expertise in the industry enables them to offer tailored advice that aligns with an advisor's specific career goals and circumstances.

Negotiating Better Transition Packages: One of the key services offered by transition consultants is the negotiation of transition packages. These experts can leverage their understanding of U4 impacts to secure the best possible terms, ensuring that the advisor's move is both financially and professionally advantageous. This might include better compensation structures, supportive measures for client transition, or even assistance in managing U4 disclosure impacts with the new firm.

Engaging Legal Counsel: Hiring legal experts who specialize in financial regulations and FINRA arbitration can provide critical support for advisors seeking to expunge or mitigate U4 dings. These professionals can evaluate the specific circumstances of each entry and determine the feasibility of expungement.

The Expungement Process: The process of expunging a U4 ding involves filing a claim with FINRA and undergoing an arbitration hearing. Legal counsel will prepare the necessary documentation, represent the advisor during the hearing, and argue the case for expungement based on inaccuracies or other valid grounds. Successful expungement can remove detrimental entries, significantly improving an advisor’s professional prospects.

Long-term Career Benefits: Successfully managing or expunging U4 dings can dramatically enhance an advisor’s career trajectory. A cleaner U4 record broadens opportunities with prestigious firms and increases the advisor’s marketability and professional standing.

Enhanced Professional Reputation: Addressing U4 issues effectively not only improves opportunities but also boosts the advisor's reputation within the industry. A record clear of significant dings reflects reliability and adherence to ethical standards, key traits valued in financial advisors.

A Ding Doesn’t Mean You’re Done

While financial advisors cannot afford to ignore the entries on their U4 disclosures, they also should not feel that early career missteps or misunderstandings with clients will indefinitely hinder their career progression. It’s important to approach U4 issues with a strategic mindset, recognizing that not all disclosures are insurmountable barriers.