Even before the Great Resignation, broker-dealers were struggling to slow the departure of financial advisors and attract new professionals to the wealth management industry.

Technological advancements and pandemic-driven disruption have now added to that challenge, with 15% of advisors at wirehouse firms and 7% of independent advisors now categorized as “at risk” of leaving their firms in the next two years, according to the J.D. Power 2022 U.S. Financial Advisor Satisfaction Study, released today.

“Advisor loyalty is declining,” Mike Foy, senior director of wealth and lending intelligence at J.D. Power, told Financial Advisor Magazine. “With the average age of a financial advisor climbing to 57 this year, wealth management firms that want to continue to grow must do more than just manage advisor attrition rates; they also need to actively create advisor brand evangelists who will attract the next generation of talent,” Foy said.

This is the first time J.D. Power created and used the brand evangelist category “to really differentiate between firms that create them and those that instead create advisors who are compliant passives—who aren’t looking to leave, but aren’t advocating on behalf of any broker-dealer’s brand or likely to recommend the firm to peers either,” Foy said.

“We’re taking a closer look because you need to do more than just prevent attrition, you need to create brand evangelists,” he said.

Among employee advisors, Edward Jones ranks highest in the study’s overall satisfaction category with a score of 876. Stifel (872) ranks second and Raymond James & Associates (863) ranks third.

Among independent advisors, Commonwealth ranks highest in overall satisfaction with a score of 918. Raymond James Financial Services (842) ranks second and Ameriprise (821) ranks third.

Morgan Stanley, which has invested millions to develop its wealth management platform and attract advisors is also gaining ground in terms of advisor satisfaction, Foy said.

“When we think about firms that are making culture shifts, Morgan Stanley is the best example of a wirehouse where we see significant improvements looking back over the past couple of years. They have really created some distance from their more direct peers in the wirehouse group,” Foy said.

Ameriprise is another firm where J.D. Power has seen improvements in terms of creating advisor loyalty, he added. “It’s not easy to change culture at firms of these sides when you’re dealing with 10,000 or 20,000 advisors who view themselves as small business owners, even if some aren’t literally. Changing culture is a long-term proposition,” Foy noted.

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