All about advice | Straight talk for advisors

All about advice is a column offering financial advisors unvarnished, direct perspectives on success and practice growth.

For the past several years, I’ve watched a steady stream of advisors leave wirehouses to build independent practices. The conventional explanation is that advisors are taking advantage of attractive acquisition multiples while valuations remain high. That’s certainly part of the story. But in hundreds of conversations over the past three years, I’ve heard something else — something that economics alone don’t explain. What I hear, more often than not, is a list of grievances.

With the Fourth of July approaching — and America’s 250th anniversary — I keep returning to the Declaration of Independence as a framework for what advisors are telling me.

When the Founding Fathers declared independence in 1776, they didn’t simply announce that they wanted a different form of government. They carefully documented 27 grievances — specific complaints against a system they believed no longer served the interests of the people. Their objections ranged from taxation without representation and interference with self-government to restrictions on commerce, denial of due process, and the concentration of power. Their conclusion was straightforward: The existing structure had become incompatible with the principles by which free people should be governed.

The stakes in wealth management are obviously very different. But the framework remains instructive. Advisors aren’t leaving because independence has become fashionable. They are leaving because, after years of operating within the same system, many have concluded that their concerns cannot — and will not — be addressed.

Five grievances come up with remarkable consistency.

Grievance 1: Failure to invest in best-in-class technology

For years, large institutions enjoyed a meaningful technological advantage because they possessed the scale and capital to build platforms that smaller firms simply couldn’t match. That advantage has largely disappeared.

Today, many wirehouse technology platforms resemble old houses that have been remodeled one room at a time. A new application is layered onto an aging system. Another legacy platform is patched rather than replaced. The result is a maze of disconnected technology that is increasingly difficult to maintain, integrate, or modernize.

Too much of the technology budget is devoted to supporting yesterday’s infrastructure instead of building tomorrow’s capabilities. And because many firms insist on developing solutions internally, innovation often moves far more slowly than it should. By the time new capabilities arrive, independent firms have frequently been using better solutions for years.

Grievance 2: The loss of culture and connection

Many firms spent decades pursuing the belief that bigger is better. Growth became the objective, often at the expense of culture.

But wealth management has always been a relationship business. Culture is not a slogan. It shapes how people behave, how quickly problems are solved, and whether advisors feel connected to the organization they represent.

As organizations become larger, culture often becomes something people describe rather than something they experience. The camaraderie that once defined many firms has gradually faded. Advisors miss working in organizations where people know one another, where relationships matter, and where they feel recognized as individuals rather than production numbers.