April 22, 2020
Louis Diamond Quoted
By Asia Martin
LPL Financial has gone live this week with its new premium affiliation model, dubbed Strategic Wealth Services, for advisors coming out of the wirehouse and regional firms, and has released new details on the offering. WealthManagement.com first reported news of the new affiliation model, aimed at taking some of the more entrepreneurial tasks involved in starting and running a practice off advisors’ shoulders, this time last year; the firm now has a built-out operation in place to serve these advisors, who join as independent contractors. Strategic Wealth Services will help established regional and wirehouse advisors who have high production and manage more than $200 million in assets under management.
The payout is confidential and dependent on the complexity of the advisor’s practice. The average payout at a wirehouse is a conservative 40% to 50%, according to Louis Diamond, senior consultant and executive vice president of Diamond Consulting. Diamond is also recruiting for LPL. Steinmeier said SWS’ payout leans more towards the net payout of an independent advisor, except the rep is not paying for his or her own overhead costs. Instead, they’ll pay a flat fee encompassing a bundle of other fees.
“It’s much simpler and I think more transparent the way that [LPL is] pricing this relative to how they typically price and how others in the space price,” said Diamond.