Five More Questions to Ask Before Changing Your Broker-Dealer: Part 3 of 3

To get caught up on where this post begins, you may wish to review Part 1 and Part 2 of this three-part series about changing firms.

Question # 6: What is your business mix?

Why this is important: If your business mix does not align with your broker-dealer, you’ll find yourself struggling to be on the same page as them. For example, if you are focused entirely on fee-based business, and your broker-dealer is predominantly focused on alternative investments, it’s likely that you’ll run into some challenges as a result of their core focus differing from yours. Your business mix doesn’t have to align 100% with your prospective broker-dealer, but you’d be wise to choose a b/d who understands and appreciates the type of business you do.

Question # 7: Do you have anything in place to help me transition/exit from the business?

Why this is important: If you are 60 years old and retirement is on YOUR mind, you’d be best served with a broker-dealer that could potentially make your transition into retirement easier. Moreover, if you are 40 years old, and the idea of acquiring another practice or protecting your practice in the event you died unexpectedly is important to you, aligning with a broker-dealer that could address these items becomes important.

Question # 8: What is the average turnaround time from your advertising department?

Why this is important: If you do any sort of advertising or marketing, you recognize the importance of this question. If you’ve ever had to wait weeks for one of your marketing/advertising pieces to be reviewed by your broker-dealer, you know why a quick turnaround time is essential. Let’s put it this way: Not all broker-dealers are created equally when it comes to advertising turnaround.

Question # 9: Tell me about the owner of the broker-dealer.

Why this is important: Believe it or not, the owner of your broker-dealer can have an incredible impact on your business, positively or negatively. If the owner of your b/d is caught in a media frenzy of negative headlines, there’s no doubt you’ll have questions to answer from your clients. If your broker-dealer is a publicly traded entity, you’ll need to accept the fact that some decisions may be made in the interests of the shareholders. Are you able to actually meet and converse with the owner? For many advisors, this can be comforting as it allows them the chance to express concerns and get a real gauge on what drives the business decisions of the broker-dealer.

Question # 10: Will you invest in me to visit you?

Why this is important: As much as technology is important these days, this business is still about people. It’s important that you look the people at any prospective broker-dealer right in the eyes. You need the opportunity to see if the culture of the firm is the right fit. You need to see if the philosophy and business mix of the firm is the right fit. You owe it to yourself to give the people at the prospective firm a good once-over to help you with your “gut check.” Your potential broker-dealer should be willing to foot the bill for you to explore all that they have to offer. That’s what we do here at USA Financial Securities, an independent broker-dealer and subsidiary of USA Financial.

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