Excerpted from “We’ve Got Your Back – What LPL’s Supported Advisor Model Signals To The Industry “, by Frank LaRosa

There is the dawn of a new age occurring in financial services and it is one based on what might seem to be an obvious edict, yet it took a while to take hold. Put simply – if you are a firm who wants to lead the industry then recognize your advisors are your number one asset and treat them as such. That school of thinking was certainly realized this week as LPL Financial rocked the financial services industry with the launch of their independent employee-advisor model, which reinvents the entire concept of the supported, or W-2, advisor.

The LPL Financial independent employee-advisor model is robust in benefits to advisors. In terms of compensation, advisors under the structure have the opportunity to achieve a 50 to 70 percent payout with no platform, transaction, or administrative fees. Additionally, the program allows advisors to own their effort and lead their practices accordingly, with complete autonomy and retention of their book of business. What’s more, the LPL Financial independent employee-advisor model offers its advisors structured support to enable advisors to grow and successfully manage their practices. Among the features of the LPL Financial independent employee-advisor model are dedicated marketing for brand development, administrative support, and resources for growing capital and monetizing business, as well as other business consulting services.

A supported advisor model such as the one LPL Financial launched has been a long time coming and is a welcomed breath of fresh air in a financial services industry plagued by the old school, C-suite thinking of wirehouse firms. In an effort to seek relief from the captive W-2 constraints of the wirehouses, advisors in droves have turned to the independent model in the hopes that they could design for themselves a practice which operationally and philosophically aligned with their business vision. And therein, lies the quandary. While the independent model can be an extremely successful alternative for advisors seeking to chart their own course it does require by nature a certain set of entrepreneurial skill sets in order for its full potential to be realized – a subject I explore in my Advisor Talk With Frank LaRosa podcast episode “You Do You – Independence Isn’t The Only Option“.

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