Broker-dealers trying to keep advisors in one of the busiest recruiting markets on record should lean harder on technology, firm branding and specialized client services, according to research from Cerulli.
According to a new report from the Boston-based research and consulting firm, 8.6% of U.S. financial advisors are set to change firms this year, putting roughly $3.4 trillion in client assets in play.
With more advisors than ever chasing flexibility, better economics and different client service models, Cerulli argued that broker-dealers will need to offer more freedom without giving up the support that has long defined the channel.
Technology is where firms have the most room to stand out. Some 57% of advisors told Cerulli that technology played a part in their decision to join a new broker-dealer in the past three years. Firms with open-architecture platforms and tools advisors can customize could gain an advantage, the report found.
"Allowing advisors more discretion in selecting the tools and resources that best support their practices can enhance their sense of control while improving their ability to meet evolving client needs," said Michael Rose, a director and co-head of Cerulli's wealth management practice. "Firms that can provide increased flexibility with institutional support will be better positioned to attract advisors."
Broker-dealer firms are having to adjust their pitch to advisors just as the channel narrows to fewer, larger players. The 25 biggest broker-dealer firms now manage 94% of all BD assets, according to Cerulli; advisors at the five largest firms are the most productive, overseeing an average of $187 million each at year-end 2025, compared with $152 million across the top 25.
The pull toward independent models remains strong. Seventy-one percent of advisors told Cerulli they would pick an independent channel if they changed affiliations, with independent RIAs ranking as the most desirable destination.
A separate report from ISS Market Intelligence found that between 2021 and 2025, retail-focused RIAs drew 9,525 representatives from other channels, while independent broker-dealers added 5,780. Within the RIA channel, about 85% of firms – amounting to roughly 35,000 – employ five representatives at most, opening the door for aggregators to pursue acquisitions.
For broker-dealer firms, an aging advisor force adds to the pressure. Cerulli estimates some 35.2% of broker-dealer advisors, managing 41% of the channel's assets, expect to retire within 10 years.
Nonetheless, many advisors in employee channels still view their firm as a key partner in growing their business. In Cerulli's survey research of the wirehouse channel, 89% of advisors named access to lending products as a top benefit of their affiliation, and 84% cited services built for high-net-worth clients.
"A major advantage for advisors in the employee channel is the ability to leverage their B/D's branding, which helps establish trust with clients early on and facilitates marketing efforts to support organic growth," Rose said, adding that broker-dealer firms should "continue improving their resources and tools, such as marketing support and HNW services."
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