Considering going to LPL ...thoughts ?
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Agree with Managing partner. Consider opening own RIA.i left LPL a year ago this past March.
There are very few reasons to be the the B/D world. It’s not a consumer friendly environment.
Become an RIA or IAR. A good platform to check out is www.pomplanning.net.
That was my concern about the fee based, their admin costs seems to be pretty high? We don't really have any tech at the b/d we are at now, so all will be better. It is expensive for tech/resources. Considering Cambridge as well. We do a good amount of fee based and a big annuity book as well.
Why LPL? What's the draw to them?
Left them in April. Not a bad firm but if you want to do fee base (which we were moving to) it’s going to cost roughly 35-40 bips. We decided to open our own RIA to save that and passed it on to clients. They didn’t want just the brokerage side (which was only like 40MM in annuity business) so we parted ways. No hard feeling. The tech is outdated so the ability to go buy our own was also a factor. No Indy BDs have great tech anyway, so don’t let that deter you.
Check out FSC Securities Corp. I think they're great!
We looked at Cambridge but they wanted 10% (or 90% payout) on the brokerage business, not bad. But they wanted 10% off of the RIA business too. We weren’t willing to pay them that much for nothing. Don’t know the cost if you use their RIA. We ended up at Cadaret Grant because they were a lot more friendly with the RIA. We were with LPL for years but when Ron Carson left, things changed a lot there.
LPL does have their hybrid RIa, not exactly sure of the payouts on those.
OP, the hybrid RIA for LPL is a decent model but you have to have X GDC in the BD for them to allow it. I don’t remember what the number is. I don’t think it’s that high. Our problem was that we have advisors with 0 in the BD so even if it’s like 25k, everyone in our firm had to have that.
Op, So we are in NY. To open an RIA you need to have 25MM. We looked at only our IRA business. With the DOL looming last year, that’s when we decided to move to fee based just for that. Our total was well over that and then it was just a question of how to open an RIA, not if. If you have the minimum in IRA, open one, keep all the brokerage accounts with a BD. We raised 37% in revenue year over year by doing it. With lower fees to clients, (which drove more clients) and leveraged TD as the custodian (you can use Schwab or Fidelity) and clients know those companies, far more than any INdy BD.
All in cost is TOUGH!! Their EO was twice what we pay now. Ticket charges were high. Tech was about the same. Admin charge was a little high (but a lot more back office help than what we have now). I highly recommend using their home office OSJ, 400$ a month is cheaper by FAR than any other OSJ few out there which is usually an override. I’m an OSJ so I could not charge people in the firm but I can’t be my own so I paid the 400$.
Hard to compare. The tech is FAR cheaper and we got to pick what we wanted. We use Redtail, riskalize, rightcapital, Black diamond, and TD provides Morningstar. We saved over 50k firm wide and turned half that into advertising and then put the rest in the profit share “box”. OSJ is roughly the same. Ticket charges are 6.95 equity and 0.00 for most mutual funds with TD. Did have to add outsourced compliance for the RIA and IT. But we probably will net about 10-15% just in the savings of total revenue (strictly a guess).
We are an RIA only that clears through LPL and TD. Started out on hybrid side with LPL but dropped 7 and FINRA since the economics and regulations are way better.
A few groups going together, highest payout grid, products they offer. Works for our group.
RIB1 & Managing 1- I think we have too many 401k plans, brokerage & annuities for an RIA
It didn't seem like that was an issue at all. We would be in their 94/95% on corp side anyway. Trying to find Competitive fee based platforms. If we charge .80-1.00, what is a good all in (advisor fee, b/d platform fee, funds/etf) cost ?
That is good to know, what about all in cost of your fee based vs LPL ?
Lpl's hybrid out of Tx is not very good.
Can u explain more Sickle?