AdvisorTrends - The 3xEquity Podcast 3xEquity

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Summer often provides the opportunity for more downtime, and time on a beach or in a hammock is a great opportunity to pick up a book. For financial advisors, this downtime can be used strategically to enhance professional knowledge. Staying well-read helps advisors stay ahead of market trends and evolving client expectations, and engage in meaningful discussions with clients.

Here are some books this every financial advisor should consider adding to their reading list this summer.

“Slow Productivity” by Cal Newport

Cal Newport explores the concept of “slow productivity,” advocating for a focus on meaningful work and deep thinking over constant busyness. For financial advisors, adopting these principles can lead to more thoughtful, strategic decision-making and better client relationships. Newport’s ideas can help advisors manage their workload more effectively, prioritize high-impact activities, and ultimately provide better service to their clients.  Be sure to check out our recent blog post “Growing Your Practice The Cal Newport Way” for more insights.

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“Supercommunicators” by Charles Duhigg

Charles Duhigg’s “Supercommunicators” delves into the art and science of effective communication. Financial advisors who master these skills can build stronger relationships with clients, convey complex information more clearly, and influence decision-making more effectively. Duhigg’s insights into communication strategies can help advisors become more persuasive and empathetic, enhancing their ability to connect with and support their clients.

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“The Creative Act” by Rick Rubin

Rick Rubin, a renowned music producer, shares his insights on creativity and the process of creating something extraordinary. For financial advisors, fostering creativity can lead to more innovative solutions for clients’ financial challenges. Rubin’s approach to creativity can inspire advisors to think outside the box, develop unique investment strategies, and adapt to changing market conditions with a fresh perspective.

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“Sapiens: A Brief History of Humankind” by Yuval Noah Harari

While not a finance book per se, “Sapiens” offers a sweeping history of human evolution and society. Understanding the broad historical, cultural, and economic contexts in which financial markets operate can provide financial advisors with a deeper perspective on the forces that shape market trends and client behaviors. Harari’s exploration of human history can inspire advisors to think more holistically about the societal impacts of economic policies and market movements.

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“Nudge: Improving Decisions About Health, Wealth, and Happiness” by Richard H. Thaler and Cass R. Sunstein

Thaler and Sunstein explore how subtle “nudges” can influence behavior in positive ways. For financial advisors, this book provides practical insights into how to help clients make better financial decisions without heavy-handed intervention. By understanding the power of nudges, advisors can design strategies that encourage clients to save more, invest wisely, and plan for the future more effectively.

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“Antifragile: Things That Gain from Disorder” by Nassim Nicholas Taleb

Nassim Nicholas Taleb’s work focuses on how systems can thrive in the face of volatility and uncertainty. For financial advisors, understanding the concept of antifragility can lead to more resilient investment strategies and better risk management practices. Taleb’s insights are particularly relevant in today’s unpredictable economic environment, providing advisors with tools to help clients not only withstand but potentially benefit from market disruptions.

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“Factfulness: Ten Reasons We’re Wrong About the World – and Why Things Are Better Than You Think” by Hans Rosling

Hans Rosling challenges common misconceptions about global trends and data. For financial advisors, this book i

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Like so many we’re caught up reading Cal Newport’s latest New York Times bestseller, “Slow Productivity.”  Subtitled, “The Lost Art of Accomplishment Without Burnout,” Newport proposes that a path exists for true life quality AND high-level achievement (and that running yourself into the ground doesn’t have to be an inevitability).  That kind of goal likely resonates with most financial advisors, as does much of his earlier work. We turned to a few of those books for clues and suggestions on how to grow your practice:

1. Embrace Deep Work For Unparalleled Focus

Principle: In “Deep Work,” Cal Newport emphasizes the importance of intense concentration on tasks that push your cognitive capabilities to their limit.

Application for Financial Advisors:


Block Out Time for Deep Work: Dedicate uninterrupted blocks of time to focus on high-value tasks, such as developing financial strategies, analyzing market trends, or creating personalized client plans. This deep focus will enhance the quality of your work and enable you to offer exceptional value to your clients.
Minimize Shallow Work: Reduce the time spent on low-value tasks like checking emails or engaging in unnecessary meetings. Delegate administrative tasks whenever possible to free up time for more meaningful work.

Principle: In “So Good They Can’t Ignore You,” Newport argues that developing rare and valuable skills is crucial for career success.

Application for Financial Advisors:


Continuous Learning: Invest time in continuous education and skill development. Stay updated with the latest financial trends, regulations, and technologies. Consider pursuing advanced certifications or specializations that differentiate you from your competitors.
Seek Feedback and Iterate: Regularly seek feedback from clients and peers to identify areas for improvement. Use this feedback to refine your skills and services, making you indispensable to your clients.

 2. Build Rare And Valuable Skills

Principle: In “So Good They Can’t Ignore You,” Newport argues that developing rare and valuable skills is crucial for career success.

Application for Financial Advisors:


Continuous Learning: Invest time in continuous education and skill development. Stay updated with the latest financial trends, regulations, and technologies. Consider pursuing advanced certifications or specializations that differentiate you from your competitors.
Seek Feedback and Iterate: Regularly seek feedback from clients and peers to identify areas for improvement. Use this feedback to refine your skills and services, making you indispensable to your clients.




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15 Things You Can’t Afford To Overlook When Considering A Move To A New Broker-Dealer



1. Who Owns the Client: The Advisor or the Broker-Dealer?

Understanding client ownership is crucial. If the broker-dealer owns the client relationships, transitioning away in the future might be more complicated. Ensure you have clarity on this to maintain control over your book of business.



2. When Was the Last Time the Broker-Dealer Changed the FA Compensation Plan?

Frequent changes to the compensation plan can indicate instability and affect your income. Investigate the history and frequency of these changes to ensure your financial stability.



3. How Many Practices Did the Broker-Dealer Bring In Over the Past Year?

A broker-dealer that successfully attracts and retains numerous practices may indicate a supportive environment. However, delve into why those practices moved and how well they have integrated.

4. How Successful Have Prior FAs Been in Bringing Over Their Assets to the New Broker-Dealer?

The ability of financial advisors to transfer the majority of their assets can speak volumes about the broker-dealer’s support and the ease of transition. This metric is vital for assessing potential disruptions to your business.

5. How Long Has the Current CEO Been in Their Position?

Stability in leadership often translates to stability within the company. A long-tenured CEO may indicate consistent vision and strategy, which can be beneficial for your long-term plans.

6. What Was the Most Recent Enhancement the Broker-Dealer Made to Improve the FA Platform?

Continuous improvement of the FA platform suggests a commitment to providing advisors with the best tools and resources. Look for tangible improvements that can directly benefit your practice.

7. Has There Been a Recent Platform Improvement for Clients?

Client-facing improvements can enhance your service offering and client satisfaction. Ask about recent upgrades and how they impact the client experience.

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Transparency and integrity play an outsized role in the perception of financial advisors. But as we know, things happen.  The U4 disclosure form, which outlines an advisor's disciplinary history, can play a critical role in establishing (or diminishing) trust and credibility with clients. Negative entries or "dings" on this form can create hurdles when advisors seek to move to new broker-dealer firms. Understanding these impacts and the methods available to mitigate their effects is essential for career progression.

Career Implications: Negative entries on a U4 can be a red flag for potential broker-dealers, affecting an advisor’s ability to switch firms. Such dings might suggest a history of regulatory issues or client disputes, making it challenging for advisors to find favorable positions. The impact extends beyond initial hiring prospects; it can also influence an advisor's ability to negotiate terms or even attract and retain clients under new broker-dealer affiliations.

Client Relationships: Clients often review an advisor's BrokerCheck profile, which includes U4 disclosures, to evaluate their trustworthiness and professionalism. Significant dings can erode client confidence and loyalty, potentially leading to a loss of business when transitioning between firms. Advisors must be proactive in addressing these entries to maintain strong client relationships.

Exploring Options with Transition Consultants: Transition consultants, like 3xEquity, provide invaluable assistance to advisors facing U4 challenges. These professionals help assess the impact of U4 dings and explore strategic options for mitigating their effects. Their expertise in the industry enables them to offer tailored advice that aligns with an advisor's specific career goals and circumstances.

Negotiating Better Transition Packages: One of the key services offered by transition consultants is the negotiation of transition packages. These experts can leverage their understanding of U4 impacts to secure the best possible terms, ensuring that the advisor's move is both financially and professionally advantageous. This might include better compensation structures, supportive measures for client transition, or even assistance in managing U4 disclosure impacts with the new firm.

Engaging Legal Counsel: Hiring legal experts who specialize in financial regulations and FINRA arbitration can provide critical support for advisors seeking to expunge or mitigate U4 dings. These professionals can evaluate the specific circumstances of each entry and determine the feasibility of expungement.

The Expungement Process: The process of expunging a U4 ding involves filing a claim with FINRA and undergoing an arbitration hearing. Legal counsel will prepare the necessary documentation, represent the advisor during the hearing, and argue the case for expungement based on inaccuracies or other valid grounds. Successful expungement can remove detrimental entries, significantly improving an advisor’s professional prospects.

Long-term Career Benefits: Successfully managing or expunging U4 dings can dramatically enhance an advisor’s career trajectory. A cleaner U4 record broadens opportunities with prestigious firms and increases the advisor’s marketability and professional standing.

Enhanced Professional Reputation: Addressing U4 issues effectively not only improves opportunities but also boosts the advisor's reputation within the industry. A record clear of significant dings reflects reliability and adherence to ethical standards, key traits valued in financial advisors.

A Ding Doesn’t Mean You’re Done

While financial advisors cannot afford to ignore the entries on their U4 disclosures, they also should not feel that early career missteps or misunderstandings with clients will indefinitely hinder their career progression. It’s important to approach U4 issues with a strategic mindset, recognizing that not all disclosures are insu

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As a financial advisor contemplating a move to a new broker-dealer, understanding all your options is crucial for making an informed decision. Often, your first point of contact will be an in-house recruiter who is naturally inclined to present their firm in the best possible light. However, while in-house recruiters can be a valuable source of information, it’s important to recognize that you might not be getting the complete picture from them.

Imagine you’re looking for a new home and attend an open house, where you meet the seller’s agent. You describe your ideal home, and although they might know of a perfect match nearby, their priority is to sell the house they represent—not necessarily to find your dream home. This scenario mirrors the experience with many in-house recruiters at broker-dealers. They are skilled at highlighting the positives of their firm since their compensation depends on you joining their team. However, they may not divulge information about potentially more suitable alternatives.

In-house recruiters are not adversaries; they are professionals who perform a necessary role within the industry. However, like the seller’s agent in the real estate analogy, they have incentives that may not align perfectly with your goals:


Compensation Tied to Recruitment: Since their primary incentive is to recruit advisors to their specific firm, their perspective might be somewhat biased towards the strengths of their firm while minimizing its limitations.
Limited Product Mix: If the product mix that has contributed to your success as a financial advisor isn’t fully available with their broker-dealer, recruiters might downplay this aspect or not be fully transparent about the differences.
Single Firm Focus: While a recruiter can extensively detail the virtues of their firm, they are less inclined—and often unable—to suggest alternatives that might better align with your career goals and values.

Turning to an independent transition consultant, such as 3xEquity, offers several distinct advantages:


Unbiased Advice: Independent consultants are not tied to any single broker-dealer, enabling them to provide objective advice that puts your needs first.
Comprehensive Market Overview: They offer insights into various firms’ offer sizes, cultural fit, support, technology, and compliance standards, helping you make a well-informed decision.
Confidential and No Cost to You: Your discussions remain confidential, and the service is provided at no fee, ensuring your interests are the top priority.

Independent consultants work to ensure that you have a clear and comprehensive view of all your options, enabling you to make the best decision for your career in the financial industry.

By engaging with a consultant who views the entire landscape of opportunities, you gain several benefits:


Holistic Career Assessment: An independent consultant assesses your career holistically, considering your long-term goals, current success metrics, and personal values.
Expert Guidance and Negotiation: They can also provide expert guidance on negotiations, helping you secure the best possible offer from a range of potential firms.
Access to a Wider Range of Opportunities: With broader insights into the industry, independent consultants can introduce you to opportunities that you may not have considered or known about.

If you’re considering a move or just curious about your options in the wealth management landscape, don’t hesitate to reach out. A confidential conversation that could open new doors for your career. Remember, with 3xEquity, you control the conversation, and we ensure your information is never shared without your consent.

[Curious about changing broker dealers? Visit AdvisorHub Offers.]

Caveat Advisor! You might be bleeding profits because of opaque and escalating broker-dealer fees without even realizing it. Many advisors haven’t re-evaluated their broker-dealer agreements since initially jumping on board. Back then, your smaller asset base may have meant seemingly more manageable fees. But as your AUM has grown, have your broker-dealer’s fees ballooned as well? It's time for a wake-up call to reassess these costs and consider whether you're genuinely getting your money's worth.

The Stealthy Creep of Broker-Dealer Fees

Broker-dealers provide indispensable services, but at what cost? Many financial advisors overlook the cumulative impact of these fees on their business's bottom line. This oversight is partly due to the complex structure of these fees—ranging from asset-based percentages to transaction fees and flat annual charges. 

Are You Really Tracking Your Costs?

Shockingly, many advisors don’t really know what they’re paying in total broker-dealer fees. As your practice grows, these fees can increase significantly, not necessarily in line with the value received. It's essential to periodically scrutinize these costs to ensure they haven't escalated beyond reason.

By the way, If your heart is beating a bit faster and you’re getting curious about your fees (and how those fees compare), 3xEquity’s free fee analysis tool might be right for you.   Simply click here and complete the form for your complimentary report.  

Benchmark, Then React

Is your broker-dealer really the best game in town, or is it time to shop around? The BD landscape is fiercely competitive, and more cost-effective options may offer similar or enhanced services.

Fee Transparency and Comparison

Do a thorough market comparison to see how your current broker-dealer stacks up. You might find that what was once a competitive fee structure is now a drain on your resources. Use this insight as leverage to renegotiate your terms or as a catalyst to switch to a more economical broker-dealer.

Considering the Switch: More Than Just Savings

While the potential for lower fees is enticing, switching broker-dealers involves navigating a labyrinth of logistical challenges. Leveraging the knowledge and know-how of a transition consultant is an easy solution and one that comes at no expense to you.  Learn more and secure multiple offers all while remaining 100% right now.

When is Enough, Enough?

Determining when the savings and potential benefits outweigh the inconvenience of a switch is crucial. Calculate not just the immediate financial upside but also the long-term benefits of improved services, better technology, and more robust support.

Hidden Costs of Complacency

The real cost of staying with an overpriced broker-dealer isn’t just the fees themselves—it’s the missed opportunities for growth and improved client service that more adaptive and cost-effective platforms might offer.

It’s Time To Take The Wheel

It’s time to stop the autopilot management of your broker-dealer relationships. As your practice grows, so too should your vigilance over every expense that affects your profitability. An unchecked broker-dealer fee structure could be silently stifling your business's potential. Reassess, compare, and act—your practice’s health and your client's satisfaction depend on it. Your future self will thank you for taking control of your destiny now, ensuring every dollar spent on broker-dealer fees works as hard as you do.