Transition Checklist for Financial Advisors Making a Move

Transitioning a financial practice starts with the right decisions

For financial advisors like you, regardless of your operating scale or current business model, the decision to transition firms is a big step. Just as your clients deserve personalized solutions to reach their investment goals, you deserve a personalized partnership that helps you reach your business goals. Deciding who to partner with is just as important as the why behind your decision to transition your business in the first place. 

You want a partner that can deliver on the expectations you’ve set for your practice by aligning with your values and offering the products and platforms to help you serve your clients. And, you want a partner who can help you and your team navigate all aspects of the onboarding process — both the expected and unexpected, in a variety of areas.

Here are a few simple transition checklists to guide you when switching firms as a financial advisor. 

Questions to ask your new firm

Preparing to transition your practice is like developing a financial plan or investment strategy. You do this for your clients, and you should spend the same amount of time, if not more, on a plan for yourself. This plan should: 

• Determine what success looks like for you and your clients.
• Document critical milestones and the unique needs of your business, staff, and client base.
• Outline what you can or can’t do to prepare for the transition, in alignment with what you’ve discussed with legal counsel, especially in regard to collecting and organizing client data. 

Ultimately, the more your plan reflects the unique aspects, challenges, and needs of your business, the more successful you’ll be in aligning expectations with your new firm. Here are some important questions to ask your new firm regarding their onboarding process: 

1. How will my clients be impacted during the transition, and what will your firm do to help minimize that impact?
2. How long does the typical onboarding process take?
3. How much of my book should I expect to transition with me in that amount of time?
4. How will you ensure that I’m up to speed on your firm’s technology, platforms, and rules and regulations?
5. Will you support me before, during, and after the onboarding process? If so, how? 

Navigating the planning process

Being properly prepared, as much as possible, for your business transition is crucial. There’s a lot that falls under “planning” but getting organized in general is a good place to start. Now is the time to: 

• Determine your resignation date.
• Create a timeline.
• Organize and update your current client list.
• Share the news with your continuing team members. 

The right partner will be there to help you address each of these items. That’s why it’s important to choose a partner that offers: 

• A team to guide you through transitioning with precision and clarity and provide a customized roadmap — and a menu of contacts and resources — so you can get back to running your practice as quickly as possible.
• Subject matter experts to analyze your business and evaluate your strengths, while helping your business limit risk and find opportunities for future success before and after onboarding.

Navigating legal issues and evolving regulations

Having legal support and guidance is essential during transition planning. The legal aspects of changing firms can vary, especially if you’re moving to a new business structure or model. Engage legal counsel to help ensure you fully understand all of your agreements with your current employer (including any non-compete or non-solicitation clauses), privacy considerations for customer information, and how to prepare and execute all required legal documentation and regulatory filings.

You’ll need to:

• Have a plan to update and transfer relevant licenses.
• Determine what client data you can legally access and utilize if under Broker Protocol regulations.
• Be up to speed on any regulatory updates or changes regarding transitions. 

Again, the right partner will be there to help you address each of these items. That’s why it’s important to choose a partner that offers: 

• Compliance services to ensure you remain legally compliant with regulations without losing extra time and finances in the process. Your new firm should make your compliance a priority through training, expert knowledge, assistance, and automated processes, tools and technology.
• Education through training and learning experiences that ensure that your practice evolves and grows with changes in technology, trends, markets, regulation, and client expectations. 

Navigating client conversations and relationships

Your clients may have questions for you about how this will affect their communication with you, their investments, and their costs. Consider using these best practices to keep clients informed and at ease during the transition process: 

• Be honest and upfront about the change and why it’s happening.
• Tell clients how the change benefits or impacts them.
• Set expectations and communicate frequently as new information arises. Let clients know that you’ll provide more information frequently over the coming weeks or months, and then stick to a consistent schedule to ensure that not too much time goes by without any touchpoints.
• Ensure you take time to hear clients’ concerns and meet with top clients. No matter how well you communicate and how proactive you are, some clients will want to meet with you and some will have additional questions. In times of change, carving out extra time for in-person, phone, and video conference calls may be crucial.
• Use a variety of communication channels to keep clients in the loop. It’s difficult to over-communicate during a major change, so don’t be afraid to use your website to post blogs and video updates, send weekly newsletters or emails, meet with clients when necessary, and leverage other approved forms of communication like social media to get your messages across. 

And, of course, with the right transitioning partner your continuing clients will experience the same support that you and your team receive. That’s why it’s important to choose a partner that offers: 

• Platforms that give advisors access to a variety of solutions for their clients’ investment goals with a broad array of options, and the service and tools to use them efficiently. 
• Service and support that helps advisors and clients clear hurdles that arise during transitional onboarding. With an efficient and specialized team of service professionals, advisors’ can keep their clients informed and confident at every step. 

With LPL Financial, business transitions offer opportunities

Financial advisors looking to break away from their old firms and transition into a more independent path of their own may find everything they need with LPL. Our goal is to help you, the advisor, reach your vision of success and to support you at every stage of change and progress. With LPL as a partner, you can expect a dedicated team to help you onboard with less obstacles and more opportunities as you continue building your business your way.