Work From Home Guidance
The pandemic jolted firms that lacked effective contingency plans for financial professionals to access business and cybersecurity systems securely at home.
FINRA met with member firms to discuss challenges of having all associates working remotely.
On May 28, 2020, FINRA issued Transition to Remote Work and Remote Supervision and the COVID-19/Coronavirus Rules and Guidance page.
Significant Movement to Independent Firms
The wealth management industry has experienced tremendous regulatory change and evolution over the past decade. For example, a significant number of growth-oriented financial professionals have migrated from wirehouses and insurance companies, where they trained to become financial professionals, to independent broker-dealer and RIA firms. Many have transitioned to independence quite successfully, encouraging others to follow in their footsteps. Far from being outliers, advisors who choose an independent career path are quickly becoming the “new normal.”
Financial (FinTech) and regulation technology (RegTech) software tools have advanced rapidly in recent years, empowering independent advisors at certain firms, to work effectively and securely from anywhere there is internet access. Clearly, this capability has proven to be an advantage for those independent advisors and firms during the COVID-19 pandemic.
Even large brick and mortar wealth management firms like JPMorgan see the writing on the wall and embracing the change toward remote work. JPMorgan Wealth Management is moving forward to hire hundreds of remote advisors, to serve investors who prefer video and phone-based contact to physical locations, including those with fewer investable assets.
“Was my firm prepared for the COVID-19 crisis and able to help me get my practice back up and running immediately? Or did the firm scramble to put systems and procedures in place to help provide data access, data security, and compliance oversight?”
“Is my current firm providing the leading-edge FinTech tools and resources I want and need to enable streamlined, compliant workflows and fuel my professional growth?”
“Is my firm pro-actively helping me (and my team) to optimize the use of truly leading-edge technology to help my practice grow faster and improve client relationships?”
“Can I monetize my practice and implement the sort of succession plan and retirement arrangement I seek if I stay at my current firm?”
“My client relationships are stronger than ever before. Is my firm’s brand and level of support valuable and important enough for me to give up so much of my payout?
"Does my firm seek out and implement my suggestions for improvement?
Financial Advisors Assess Their Current Situation
COVID-19 has given advisors with traditional wealth management firms the opportunity to leave their commutes and offices behind, which for some has provided a feeling of “independence.” These months of remote work have provided ample time for advisors to consider their career paths and ask:
Independent Affiliation Options
While advisor movement to new firms has slowed due to COVID-19, advisors continue to consider their affiliation options. According to InvestmentNews data, in the first half of 2020, the greatest number of 3,568 rep firm departures were made from wirehouses and insurance broker-dealers. The largest number of new affiliations occurred at independent RIAs and independent broker-dealers.*
When considering a move from a traditional to an independent firm, or from an independent firm to a new one, there are several key considerations. At Infinity, we thoroughly enjoy talking with prospective independent financial professionals and helping them to carefully consider their options:
Whether you prefer to be an advisor only or an advisor/branch manager (i.e. hire and manage).
Location of your business (e.g. work from home, lease office space, or work from the office location of other Infinity reps nearby).
Level of experience and acumen in managing and growing your own business.
Technology knowledge and ability to come up to speed using new systems.
Preferred business model (e.g. mix of products, services, target audiences, and how you will charge for services)
Whether you will use the firm’s brand or create or /continue with your own brand.
Next, you should consider your current client base, the characteristics of your ideal clients, and how you want the practice to evolve over time. What will be your primary focus?
Wealth management (financial planning and asset management services)
Comprehensive fee-only financial planning
Professional asset management of individual or institutional portfolios and/or funds
Family office services
Working with business owners to provide asset management, succession, and benefits planning
Working in other niche markets (e.g. doctors, divorcees, employed professionals, attorneys, CPAs, Gen X/Gen Y, women, athletes, retirees, pharma industry execs, etc.)
Retirement plan advisory services
Clearly, the most flexible and popular business model for breakaway independent advisors is as a registered rep (Series 6 or 7) and Independent Advisor Representative (IAR).
Working Remotely is Here to Stay
We believe strongly that financial professionals and advisors should have the option to continue working remotely. While some may prefer to go back to an office, others will choose flexibility and greater autonomy. This will reduce some firms’ real estate costs but require them to deploy effective real-time compliance and surveillance systems.
We refer to work from anywhere as the “Infinity Virtual Office” and provide access to a comprehensive suite of cloud-based workflow and business management tools. These leading-edge capabilities exceed what some advisors can access at some of the largest firms in the industry. Importantly, I believe that it is important for relatively tech-phobic advisors to embrace functionality and software features that will shrink administrative time wasters and free up time to delight clients and grow their practices.
For personalized assistance in considering affiliation options, please click here.
* Source: InvestmentNews.com, August 19, 2020
Infinity Financial Services is a national, independent Investment and Wealth Management firm, founded with a vision: help enterprising financial professionals to grow truly independent, successful practices, leveraging leading-edge technologies and firm support.
Based in Oakland, California, with branch offices around the U.S., Infinity's financial professionals offer an array of asset management, brokerage, insurance, financial planning, benefit plan, insurance, and risk management services.This article provides information for investment professionals. It is not intended for use by the general public.