Nearly half of all financial advisors operate within collaborative team structures, according to new research from Cerulli and Osaic. In the current wealth management landscape, does it still make sense to go it alone?
Teams often benefit from streamlined resources, processes and services, yet 54% of advisors remain in a solo practice. The industry is experiencing a paradigm shift, with the great wealth transfer giving greater financial power to millennials and Gen Zers, who are increasingly seeking financial advice.
At the same time, there are fewer advisors to replace those retiring, meaning fewer advisors will have to manage more assets and clients. Advisors face the challenge of building efficiency to meet these demands, and many are increasingly turning to joining or building a team to do so.
Where to Start
For solo operators considering this path, the idea of teaming can be daunting. Taking a holistic look at your business can help.
You want to make sure you build or join a team that can create efficiency and growth and that is aligned with your goals and preferences.
Start by defining your ideal client and service offerings, and then plan how to segment and grow these areas. Creating efficiency by segmenting clients across multiple advisors can help you enter new markets and serve existing clients more comprehensively.
For instance, if your book of business is primarily mass affluent and you aim to move upmarket, you might need to expand your team's service offerings to include estate and tax planning or other high-net-worth services.
Resources to Find the Right Team
Having a clear vision and strategic plan of where you want to be is a great start. From there, leverage your advisor network and your wealth management firm to find the right partner.
Use available resources to meet others and share with them how you'd like to grow your practice. Simply articulating your goals and vision to other advisors can help you find potential partners whose practices and values may align with yours. You can even reach out to mentors if they have a practice that looks like one you might want to develop.
