RIA Tag

Which Firms Are Really Driven by Financial Planning?

17:08 07 July in Articles Written by Jon Henschen by rafferty

June 21, 2022 By Jon Henschen, ThinkAdvisor  What You Need to Know While consultative selling and financial plan-driven investing have grown dramatically, they are not as widely practiced as you may think. All investment decisions should be backed by some form of financial plan, but often they are not. Product-driven investing is increasingly being forced out, largely by FINRA fines. In 1989, I obtained a securities license through the penny stock firm J.W. Gant, with penny stock firms a common avenue for getting your securities license at the time. These firms were heavily sales driven, with every representative having the book “The Closer” on their desk. (Think of the movie “Boiler Room.”) One week after getting licensed and observing the representatives at this firm, I left for a sounder financial services foundation to build...

Small Broker-Dealers’ Secret Weapon

19:35 12 May in Articles Written by Jon Henschen by rafferty

May 9, 2022 By Jon Henschen, ThinkAdvisor  What You Need to Know Thriving smaller firms have an area of specialization, such as alternative investments. Smaller firms with high-quality advisors have fewer compliance issues because they know their advisors better than larger firms. Profitable smaller firms typically have low staff turnover, so competency is high, resulting in correct answers and quick response times. This article may run counterintuitive to many industry voices when it pertains to smaller broker-dealers, and by small, I’m referring to broker-dealers with under 200 representatives. One example of industry voices is LPL’s recent comments, on the back of a very successful year of recruiting, that they would be focused on acquisition of small BDs going forward. In spite of the doom and gloom portrayed about small broker-dealers, there are smaller firms that...

5 Reasons Going RIA Beats the IBD Model

19:58 05 December in Articles Written by Jon Henschen by rafferty

November 30, 2021 By Jon Henschen, ThinkAdvisor Two primary threats to independent broker-dealers are advisors retiring or going the RIA/dual-clearing route. Even though many broker-dealers have become friendly to advisors who to want operate with a hybrid approach, many of the larger BDs have been shutting the door to dual clearing, which generally lets advisors custody advisory assets with the BDs’ own clearing firm(s) and at TD Ameritrade, Schwab, Fidelity Institutional Wealth Services (IWS) or Interactive Brokers. Broker-dealer profit motives are the primary driver of the split from dual clearing since assets held with their own clearing firm are far more profitable than those held outside of it. With certified financial planners now required to uphold a fiduciary standard of care for client investments, we see a clash of interests that will further drive advisors to go RIA and hold advisory assets outside...