What makes smaller firms attractive to advisers on the move?

  • Published: November 14, 2013
  • Runtime: 2:00
Tim Oden of Schwab Advisor Services describes how smaller advisory firms are enjoying recruiting booms, and details what makes the smaller books of business attractive to advisers.

Exclusive coverage of Charles Schwab's IMPACT 2013 conference from November 10-13 in Washington, D.C.

Recruiting is very strong, it start off slow this year. A lot of things came up as a result of some of the extra activities last year with the fiscal cliff and a lot of the uncertainty associated with that, so the first quarter start off slow. Second and third quarters have been just going getting [unk]. Year to date, we're up 21 percent year over year from last year's recruiting rate. One of the most exciting pieces today that we have seen lately and that is just the incredible growth of the smaller books of business and when I say smaller books of business, think $50 million of assets and lower, that's grown 48 percent year over year, so it's growing disproportionate to the rest of the client base in terms of number of advisers. There's a lot of, you know, questions we've asked these advisers and you know, what's making this more attractive to you, and it's interesting a couple of things have emerged. First of all, they're looking for platforms that offer them a great deal of service at a very reasonable cost. They're not getting hit with exorbitant fees and that's one of the things that Schwab's platforms enabled them-- enables them to do. Second of all, is they're looking for a firm that is able to meet their view of what delivering service to their clients means. They are predominantly younger. They have smaller books of business because they haven't been in the industry that long, but they are next year's growers. They are 5 and 10 years from now. They will be the innovators. They will be the people that are delivering the advice to the larger clients, and so we find them extraordinarily valuable, and they all share one interesting commentary, and that is their reliance on technology is tremendous. The way they deliver advice is different. No longer do they have these big offices where they walk in to the big wood and marvel. What they have is communications via the phones and the iPads and their-- and emails, and their websites. That is critically important to the way they deliver advice and how they serve their clients. We feel like we're well positioned to be able to meet that need.

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