Displaying items by tag: LPL
Earlier this year LPL launch its new Strategic Wealth Services program. It is a special program designed to help advisors with all aspects of setting up their own business, including everything from finding an office to setting up a tech stack to executing payroll. Best of all, LPL promises to do this with “zero out-of-pocket costs for the advisors”. Despite the pandemic, the program seems to be doing well. Once advisors from a Wells Fargo team that recently departed for LPL commented on the program that “LPL’s new affiliation model really appealed to me. It allows me to be an independent advisor but solves for the business operational needs”.
FINSUM: This is a smart program. It appears specifically designed to address the multitude of anxieties advisors feel when moving to an IBD.
LPL has been a true leader on the recruiting front in 2020. One should expect no less from the largest independent broker-dealer. As one of their new initiatives, they have just launched a program—called the “independent employee” model—to try to attract new advisors who want some of the benefits of being independent, but also want to be a W-2 employee. Such models have been around for a long time, and are most prevalent at Raymond James and Ameriprise, but LPL thinks there is an opportunity to scale it up. The program is designed to appeal to wirehouse advisors who like being W-2s but want to earn higher payouts. Payouts for the program range from 50-70%.
FINSUM: If an IBD is a halfway house between being a wirehouse advisor and being an independent RIA, then this is a one-quarter-way house. It does seem like this might be a smart move—W-2 benefits with higher payouts.
LPL has debuted a new model for breakaway advisors. The firm has decided to act on something long known—the logistics for setting up a new independent business are a major hurdle for wirehouse advisors who are considering breaking away. Accordingly, they have set up Strategic Wealth Services, which will handle all office set-up logistics for LPL and make sure there are zero out-of-pocket costs.
FINSUM: Kestra has also launched a similar service. Honestly, sounds like a smart play to smooth the transition, but watch for the “catch”, which isn’t apparent yet in what we’ve seen on this.
LPL, the largest independent broker-dealer out there, is debuting what seems a curious new model to some. It is making some brokers employees of the firm, completely breaking the mold of the entrepreneurial independent broker running his own office. The firm says it is trying to offer as many good options as it can to make recruits happy and excited about joining LPL. Employees will get a lower payout but better overall benefits. LPL may start to offer attractive bonuses to recruit brokers who want to be/stay employees.
FINSUM: This makes perfect sense to us from a recruiting perspective. There are likely plenty of brokers out there who like their job job but want more stability. This seems like a good compromise.