The Taste of Independence

As I approach my first anniversary of independence I think back and consider the ups and downs I’ve experienced. For those of you in a wirehouse, bank, insurance company or other “captive” situation who are considering the move to independence, I encourage you to read on. I’m sure this can’t be said for everyone, but at least for me, once I tasted independence, there was no turning back.

I began my career with a large wirehouse and a low payout. There’s a definite culture that permeates the world of brokers and it doesn’t always fit neatly with an idealist who really wants to do the right thing for a client. The particular office I was in had about 35 brokers or financial consultants, whatever your pleasure, and eight of them were million-dollar producers. Of the eight, I would say that roughly half of them had a strong ethical character. So I’ve concluded that being a million-dollar producer doesn’t necessarily equate with high ethics. That’s where the fork in the road occurs.

The priorities are opposite with each leg. To the left is a sales culture with the potential for high income and to the right is a “client first” orientation, also with the potential for high income but with an ethical responsibility very much like a doctor’s Hippocratic Oath. It is because there is such a well-defined, definite standard in the medical profession that a high level of trust exists. Perhaps it’s time the financial services industry adopts such a standard for advisors. This would require an extreme departure from the current climate created over the past hundred years or so. Think about it. Companies would have to radically change the way they do business and especially the way they compensate their advisors.