Most of the issues with captive advisors are emotional, Albers said, like the fear of losing clients or not having what they’ll need.
“They’re scared to death of compliance,” Sonnen added. And some can’t get away from the idea of getting paid to move, even though it’s almost a certainty their assets will grow more at an RIA, he said.
These advisors “are very sophisticated with their clients, but very unsophisticated with running a [business]” or understanding their options, Albers said.
But the issues within the big firms are enough for some wirehouse advisors to make the jump.
Underlying the desire to move from the big houses is “the utter lack of control” advisors have over the businesses they’ve built, Willis said. Large firms need to manage to the lowest common denominator, a problem amplified by managers who sometimes don’t care.
RIA firms can attract wirehouse people by being able to show how they will be “loved and appreciated in that model,” Willis said. A well-developed marketing plan that attracts new business will also draw recruits, he added.