OK…

So the most often discussed topic in Wealth Management circles has to be about the Silver Wave…. the coming exodus of talent out of the sector. The statistic which everyone is fixated upon is that – 1/3 of all financial advisors will be retiring and exiting the business within the next 10 years.

That discussion is for another blog post.

Here is a statistic which I would like to add to the Silver Wave stat.

(This statistic is not scientific and has little to no basis on any study – it is simply based on my previous observations as well as what I have personally experienced as a consultant over the past 2 weeks.)

1/3 OF ALL FINANCIAL ADVISORS WORKING AT A WIREHOUSE AND DOING OVER $1 MILLION OF PRODUCTION WILL BE TERMINATED : “FOR VIOLATING FIRM POLICY” IN THE NEXT 10 YEARS

In the past 2 weeks I have been involved with, either directly or indirectly, 5 unrelated financial advisors at 3 of the 4 wirehouses in varied geographical locations representing well in excess of $10 Million in production that have in 3 cases been terminated and in the other 2 cases resigned from the firm and went somewhere else for simply fearing of being terminated.

All were Terminated for “Violating Firm Policy” –

Not for serious errors in morality,

Not for bad investments – aka: churning or inappropriate,

Not for taking client money….stealing, borrowing or otherwise.

In all of the cases it was simple bad judgement, no harm, no foul…could’ve been (and any other time but now would’ve been) handled in house or dealt with without disruption or the potential ruining of a career……

Just Fired for that new wirehouse compliance officers favorite B.S. catch all – “Violating Firm Policy” …the legal equivalent of the “dog ate my homework”

Stay Where You Are Wirehouse Advisor & Sell Your Practice At A Huge Discount Or Possibly Get Fired….

As someone that has spent his entire career either on the trading side at a wirehouse, as a wirehouse advisor or as a consultant to financial advisors this trend absolutely infuriates me…as well as saddened me. The role of the Financial Advisor especially within the wirehouses has changed so dramatically in such a short period of time that it is anyones guess just how bad it could get. If you are a financial advisor at one of the Big 4 – what are you doing still there? No worries…

You can leave via a process of reviewing your options and thoughtfully & logically finding the best place for your clients as well as the ideal situation for you, your partners/team and family with professional guidance and advice from Teocalli…..OR if you are looking to retire you can take the succession plan the wirehouse firm is offering you and in doing so sell your practice, which took 30+ years to build, at an enormous discount to its true value and to your junior partner, team or son/daughter – with virtually no idea of what they will actually secure or what the firm will even look like given the wirehouses disdain for the value of you let alone your practice……..or just stick it out thinking it’ll get better….and get fired.