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New advisors find a way to tap into expertise, connections, and an existing client base

August 28, 2009

As more financial advisors postpone retirement, new advisors are finding that partnering with these veterans can be a good way to break into the business.  In today’s Wall Street Journal article “Newbie Money Managers Look To Older Mentors” Shelly Banjo points out that for these unions to succeed not only should the advisors have similar values, investing philosophies, and fee practices; they should also have a clear understanding of the business aspect of the partnership.  Robert Schmansky of Northern Financial Advisors in Franklin, Michigan recently conducted a search to join a new firm.  “You want to leverage the knowledge of an experienced advisor in building your own experience,” he notes, “but you also don’t want to be left out in the cold when that person retires and wants to sell their business.”  Bert Whitehead of Cambridge Connection in Franklin has developed what he calls a “stress-free” mentoring program: After advisors have worked for his firm for five years, they have the option of buying out their clients for one-and-a-half times the clients’ revenues and starting their own firm.  “When they leave,” says Whitehead, “I shake their hands as they go out the door and they write me a check.”