Most advisors will change firms three or four times over their careers. But the specifics of making a career move in the best way for you remain elusive. Say you’ve accepted an offer with a new company – now what? When should you start? How should you resign? How do you move your book? How do you handle a non-solicit? What does your first day look like? At my firm, the Rummage Group, these are the pressing, and understandable, questions we get most often from advisors. Here is what I try to convey to them.
GET YOUR BOOK IN ORDER
The most rewarding part of being an advisor is building a client base that will follow you to the ends of the earth —or at least to a new firm. Most advisors’ books are worth a small fortune if they are being used in the most advantageous way possible.
But if you move without your clients, you are suddenly just unrealized potential. This may seem obvious, but we come across bank advisors who do not seem to grasp this principle.
We suggest a simple segmenting exercise. Make a spreadsheet of your clients in four categories. The A-clients are the ones you know will go with you. B-clients are the ones you think will. C-clients are the ones who you have no real idea if they will follow or not. And D-clients are the ones you know won’t follow you (or who you don’t want.)
If categorized accurately, you likely will move about 80% of the A clients; half of the Bs; 20% of the Cs; and just a few of the Ds. This should give you a good estimate of what assets will follow you.
Gather all your client’s information. If you are at a firm outside the protocol, it is important not to print client statements or lists.
If you have a non-solicit, you should seek legal counsel to ensure you don’t inadvertently violate it.
Instead of printing anything, you should handwrite client information. Write a few dozen every evening before you leave the office and take that list home. If you take one big list on your last day it could cause problems.
The items you will need are: account titles, account types, addresses, phone numbers and account balances.
Start looking your clients up on the Internet and social media: Facebook, LinkedIn and Twitter are the best places to start. Save the links to their online profiles for future use.
A very small percentage of advisors who have a non-solicit will ever have any litigation. Most of them will just get nasty threatening letters reminding them of their non-solicit.
Giving your old firm any proof that you have any client information makes litigation more possible. Also, remember they can find out what you’ve done on your work computer.
HOW TO RESIGN
There are many best practices when it comes to resignation, but here’s my suggestion. Write just one sentence: “I resign my position immediately from XYZ.” Sign and date the letter and nothing more. Do not thank the firm or manager for anything. This could possibly be used against you if there were any litigation.
I suggest leaving the letter on your desk and calling your manager to tell them you have resigned and where they can find the letter. You should also email them a copy of the letter as well.
I know that resigning in person sounds like the more professional “stand up” thing to do. However, some managers take a resignation personally and can cause a scene. Often they will try to pull at your heart strings to get you to change your mind. Sometimes they present you a counter offer to stay, but I’d suggest sticking to your plans and not accepting such an offer. If you do, you can become a “marked” man. They won’t forget that you wanted to leave them once. It’s best to avoid the drama.
A start date should be far enough in the future (usually two to four weeks) to give you ample time to gather all of your clients’ information. It also gives you more time to develop a strategy for moving your clients.
Historically, advisors have resigned late in the day on a Friday and, if possible, just before a long weekend. Indeed, this practice, which started prior to any protocol, is still sound.
Don’t expect your first day at the new firm to go smoothly. Oftentimes, your office, business cards or computer login are not ready. At this point, remember, your biggest task is moving over your clients. Once you arrive at the new firm (usually about 3 p.m. on a Friday), you should start calling your clients. Spend the whole weekend calling and setting up meetings.
You should have a list of bullet points to use when talking to your clients. Why you made the move and what is in it for them. What benefits will they enjoy if they follow you? Have a presentation ready regarding the ease of them moving their accounts via the ACAT process. It should be all about them, not you.
Spend time thinking about what you would want to hear if your advisor called you to ask you to move your account. This is one of the most important conversations you will ever have. If clients don’t move, you lose revenue. We use a business coach who specializes in helping advisors move more of their assets. He is well worth his fee.
Not every client will follow you immediately. You must keep trying via newsletters and other marketing programs. Some will move as soon as they can, others may take up to a year. Be patient and remember, you get more bees with honey.
Changing firms should only happen when it benefits you and your clients. If you know your options, you can find a situation better than you have now. If you have thought out your move, it will be rewarding for all parties involved.