By Jeff Buchheister

As independent broker-dealers and registered investment advisor firms continue to consolidate, firms seeking to capitalize on the disruption are flooding the market with higher transition assistance offers and bigger pay packages. The numbers are eye-catching. The sales pitches by recruiters are well-rehearsed. The pressure to sign quickly is real.

But based on countless discussions with advisors who have transitioned to and from firms, there's a growing disconnect. Many are letting life-changing decisions about the future of their business be influenced by one or two headline numbers in an offer letter, in many cases overlooking the fine print and failing to conduct the real diligence that supports long-term growth.

I've seen what can happen next firsthand. After a burdensome transition, advisors sometimes realize there are fees they didn't anticipate, terms they didn't understand, and a lack of growth and service support where they need it most -- in short, that they've picked the wrong partner. And unfortunately, the last thing anyone wants to do following a difficult transition is move again -- it is just too value-destructive.

It's a tough lesson, but a preventable one. Advisors need to look past the upfront dollars and flashy sales pitches and focus on what a transition to a new partner means to the growth of their business and cumulative value creation over the coming decade and possibly beyond.

Here are three key questions I encourage advisors to not only ask but definitively answer before making a move.

Will my new firm help, hurt, or simply support my existing business growth rates? When an advisor is transitioning their business between firms they spend about a year repapering accounts, learning new systems, and updating processes. This means they generally can't grow their client base during this time. Based on industry data and my experience across multiple firms, transitioning firms lose 10% to 15% of their revenue to lost clients and business disruption. That means they would require over 10% incremental annual business growth over five years just to regain the value of their business.

The value of recurring annual growth will be significantly greater than any unspent transition dollars or minor payout/fee differences. A large transition assistance package might seem like a win at first glance, but many fail to consider the cumulative value lost across not only the year of transition, but in the years that follow and the resulting impact on the equity value of their practice.

To avoid this, advisors should perform diligence on the growth value proposition of a prospective partner and run a side-by-side model that includes reasonable transition and terminal value assumptions. Almost any transition assistance package will fail to compensate for client breakage and year of lost growth absent a substantially higher level of recurring annual growth following the year of transition.

Does the onboarding experience address my firm's unique needs? Given the potential for client breakage and business disruption in the transition year, advisors should talk through proposed onboarding plans to understand how it will impact their clients, their staff, and their daily activities for the next six-to-12 months. They should consider whether the firm's onboarding process will address the unique needs of their business and what level of dedicated resources they'll have access to throughout the process.

Is there a strong cultural fit and an advisor community? Access to a like-minded advisor community is often undervalued in terms of the impact it can have on your team and the rate of growth for your business. "Cultural fit" may sound cliché, but in my experience financial advisors benefit from being part of study groups and networks with peers who run similar businesses, have similar challenges, and are willing to share proven practices.

A community that allows you to test ideas, identify new ones, and build partnerships is invaluable. By the same token, having colleagues that you can relate to and feel comfortable around is also important. One way to vet culture and community is by looking at how advisors are structured within the overall firm ecosystem. Are they just another number among thousands, or are they organized into communities of like-minded professionals?

The competition for your business and financial incentives will likely continue to rise. Larger firms offer deep training, coaching, and growth support that in some cases includes growth capital. When performing comprehensive due diligence I encourage business owners to ask these tough questions, think longer term, and appreciate the power of culture and community. This is the foundation of your next chapter and the key to business growth, value creation, and the ability to serve your clients in the way you envision.

Jeffrey Buchheister is the CFO of Cetera Financial Group and serves on its executive leadership team. Before Cetera, he spent 13 years at LPL Financial, most recently as executive vice president and chief accounting officer. He also served as a board member and audit committee chairman for the Private Trust Company, a subsidiary of LPL Financial. Before joining LPL, he was a senior manager at Deloitte.

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December 16, 2025 14:43 ET (19:43 GMT)

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