How to Join a Financial Advisor Franchise

There are many paths advisors can follow to go independent, and for some, the franchise model proves to be most appealing. Establishing a financial advisor franchise allows you to operate your own business under the umbrella of a larger, recognized brand. Franchising allows for freedom, flexibility and expanded earning potential for advisors who are able to find the right brand fit.

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Understanding the Financial Advisor Franchise Model

Financial services franchising isn’t that different from franchising in other industries. When you affiliate yourself with an advisory firm as a franchisee, you get access to a variety of benefits, which may include:

Branding assistance
Flexibility in choosing your operating location
Transition support for yourself and your clients
Cutting-edge technology and tools
Training and business development opportunities
Professional certification support to help you obtain required licenses
Practice management tools and support
Succession planning resources

In short, the franchise model equips you with everything you need to serve your clients while benefiting from the increased visibility of an established brand. In exchange, you pay a franchise fee to the firm that you’re affiliated with.

Benefits of Financial Advisor Franchising

Franchising might not be right for every advisor, but there are some advantages to partnering with an established brand.

Becoming a franchise financial advisor can help you to:

Scale your business more effectively and efficiently, using the tools and resources provided by your franchisor
Leverage your franchise firm’s marketing resources and budget to promote your business to a wider audience and attract new clients
Diversify your income streams and increase profits, based on the franchisor’s compensation model
Offer a more comprehensive range of services to clients, increasing revenues and encouraging loyalty in the process
Delegate essential and non-essential tasks so that you have more time to focus on meeting the needs of your clients
Grow your client base locally at a steady pace by utilizing tech tools
Nurture client relationships and encourage engagement, without feeling the pressure to complete monthly sales goals or quotas
Develop continuity and succession plans that ensure your clients are taken care of should you leave the business for any reason
Build an advisory practice that reflects your values while eliminating unnecessary fees for your clients

Aside from those benefits, there’s a cost component. You may need a smaller amount of capital to become a franchisee versus launching a fully independent firm solo.

How to Find a Financial Advisor Franchise to Join

Be sure to compare and evaluate the different franchise options available to you.

While you might come across several franchising opportunities for financial advisors as you’re doing your research, it’s important to be discerning and take your time when selecting one. You might be drawn to a particular brand because of its reputation or market share, but those things only scratch the surface – taking a deeper dive into the firm’s franchise model can help you decide if it’s truly a good fit for your business goals.

Here are some of the most helpful things to consider as you compare and evaluate the different franchise options available to you:

Cost. It’s important to understand upfront how much it will cost you to become a franchisee. There is typically a franchise fee, which may be a minimum of $10,000, as well as royalty and advertising fees. Firms may also require a minimum capital investment of $25,000 or more. Check to see if the franchisor offers financial assistance to help you get started.
Marketing. Marketing is critical to your success, and you should be clear on what tools or support the franchisor provides to help you promote your business. For example, will you have a dedicated specialist who assists with branding? Will you have access to done-for-you content that you can use on your social media accounts or business website? What about support for referrals? The best advisory franchisors provide you with a suite of resources to help bolster your marketing efforts.
Technology. Tech tools can make your job easier and provide a better user experience for your clients. It’s helpful to review the franchisor’s tech stack and how the various tools included can help increase the efficiency of both your front and back office operations.
Training and development. Successful advisors are always learning and looking for opportunities to develop professionally. Some of the ways a franchisor may support development can include access to in-person or online workshops or seminars, individual or group training sessions, and online self-study courses.
Practice management. Brands may offer a range of resources to support practice management, ranging from recruiting tools to help you attract top talent to career coaching to internal workflows that can increase efficiency.
Support. Embarking on the franchise journey can sometimes be a challenging transition to navigate. Knowing that you have a support team on standby to offer help or answer questions at each stage can make the process less daunting.

If you already have an idea of which brand you’d like to work with, you may be able to find information about franchising on the firm’s website. You can also use a financial advisor franchise service to browse franchise opportunities and get an introduction to start the process.

Frequently Asked Questions (FAQs)

What Licensing Is Required to Become a Franchise Financial Advisor?

The license(s) you’ll need to operate a franchise is determined by the brand you’re working with. At a minimum, you may need to have the following:

Series 7 license
Series 63 or 66 license
Series 65 license
Life and/or health insurance licenses

Additional licenses or certifications may be required, depending on the products and services you offer. Your franchisor may give you a certain amount of time after becoming affiliated to meet the necessary licensing requirements.

What Is a Normal Franchise Fee for Financial Advisors?

Franchise fees can vary by firm. A typical fee may range from $15,000 to $50,000, which covers the cost of obtaining a license to use the brand’s name, as well as other costs required to get your franchise started.

What Are the Benefits of Being an Independent Financial Advisor?

Starting an independent financial advisor firm can offer greater flexibility and freedom than working for someone else. You can choose which clients you want to add to your book of business, how you choose to market your firm and who you’d like to hire to work alongside you. The franchise model allows you a similar degree of freedom, but you get the support and brand recognition of an established firm.

Bottom Line

Two advisors discuss the benefits of a financial advisor franchise.

Pursuing a franchise model could make sense if you’re ready to move towards independence. but want built-in support to guide you toward success. Taking time to explore financial advisor franchise opportunities can help you find a brand to work with that reflects your values and goals.

Tips for Growing Your Advisory Business

Building a digital footprint is crucial for marketing, as potential clients increasingly rely on search engines to find financial advice. If you’re looking to improve your return on investment or simply streamline your marketing efforts, you might consider partnering with a platform like SmartAsset AMP. You get the benefit of a holistic marketing approach along with tools that can help you grow your client base. Schedule a demo to learn how you can put it to work for your business.
While a franchise model can allow for some independence, it isn’t the same as starting an RIA firm that you own. Weighing the potential risks, including the startup costs and the lack of full control, can help you decide if affiliating yourself with a larger brand is worth it.