I want to give you my insightful industry lessons learned from my most recent trip to Old Navy. Yes, that’s right….Old Navy—the clothing store.
Those of us that have been independent for a while sort of instinctively know there's a nice economic advantage to being independent. However, if you're not there yet, I want to go through each category that you need to have a sense of, both in your current situation and in an independent model, and how to account for each one. You can then do a hypothetical profit and loss statement. How would it look if you had your own practice? It is hard to nail down the numbers (especially on the "what if you go independent?" side), but you can certainly get a pretty good estimate of what the numbers look like, and that will help you decide if it's worthwhile to you. I will touch on some of the reasons or situations where it might not make sense to go independent.
Being an independent financial advisor doesn't mean you are stuck by yourself with no opportunity to share ideas with other advisors like you would at a wirehouse. In this video, I wanted to share my thoughts on my firm's annual conference where I was able to network with independent advisors from across the country.
When I was talking to independent financial advisors before I made the move, I came across a strange phenomenon: they didn't seem to know what their net payout was!
Number five of why not to go independent (a pretty big one), if you don’t think you’re clients will go with you then you should not go independent because all the economic benefits, the flexibility, the control - if you don’t have clients, it’s sort of pointless.
Number three I listed was, if you’re looking for the biggest amount of money in your bank on day one that you go independent -- so the upfront check. I did an episode about comparing going independent versus taking the check proverbially.
This is a transcript of HTGI podcast episode 10 (click HERE to check out that show) where I discuss the employee model and how it differs from the independent model. It has not been edited to a final draft quality, so please excuse any hard-to-follow passages. You can also listen to the show using the media player to the right or below if on mobile.
The first reason is a very obvious one. If you fit this one, you probably aren’t reading this. But if you do not want to, you don’t need to, and you like where you are and you see no reason to change, obviously would not want to go independent.
I recently wrote a post/series of posts (check out the first one by clicking here) about the things you absolutely need to setup your practice and get you through the first 90 days or so. I wanted to also write about some of the items I think you DON’T need to invest time and money on yet.
Last, but most importantly, you need CLIENTS to establish your own practice. I've put it last on purpose because the other things have to be in place before you pull the trigger to have your own practice.