Most financial advisors are resistant to the idea of partnerships. They see it as a sign of weakness, or a way to relinquish control of their business. However, there are many benefits to be had from forming partnerships with other financial advisors.
This article will explore those benefits and why financial advisors should reconsider their stance on partnerships.
Why are Financial Advisors Resistant to Partnerships?
There are a few reasons financial advisors may be resistant to partnerships. The first is that they see it as a way to give up control of their business. Financial advisor businesses are often built on the personal relationships between the financial advisor and their clients. For many financial advisors, giving up even a small amount of control can jeopardize the business they have worked so hard to build.
Another reason financial advisors may be resistant to partnerships is because they are used to working independently. Financial advisors often work long hours and weekends to keep up with the demands of their clients. Sharing decision-making or workload can be daunting for financial advisors who are used to being in charge.
Financial advisors may be resistant to partnerships because they are not sure how it will affect their bottom line. Financial advisors are often very concerned with their commission structure and how it will be affected by bringing on a partner. Many financial advisors worry they will have to give up too much of their commission to make a partnership work. However, as you will see in the next section, the opposite happens in partnerships.
What are the Benefits of Partnerships?
There are many benefits to financial advisor partnerships, despite the initial resistance that financial advisors may have.
- More leads and opportunities to network: One of the biggest benefits is that it allows financial advisors to tap into a larger network of clients and potential clients. When financial advisors partner with other financial advisors, they have the opportunity to share leads and referrals. This can lead to a significant increase in business for financial advisors who form partnerships.
- Increased buying power: Another benefit of financial advisors partnering with each other is allowing them to pool their resources. This increased buying power can negotiate better terms with vendors or get discounts on office space or marketing materials.
- Shared workload: As a business grows, the workload can become too much for one financial advisor to handle alone. Partnerships allow financial advisors to share the workload, increasing efficiency and better client service.
- Increased commissions: One of the biggest benefits of financial advisor partnerships is that they can lead to an increase in commissions. When financial advisors partner with each other, they can often negotiate higher commission rates from their clients. This is because clients are often willing to pay a higher commission rate for the peace of mind that comes with working with multiple financial advisors.
- Improved financial stability: Financial advisor partnerships can also lead to improved financial stability for financial advisors. This is because financial advisor partnerships often have multiple sources of income, which can help to offset any dips in business.
Partnerships can lead to increased business, improved financial stability, and higher commission rates. Partnerships should be on your radar if you are looking for ways to grow your financial advisor business.