In a recent blog, Michael Kitces, Pinnacle’s Director of Wealth Management cites a Cerulli Associates report stating that the number of financial advisors who are outsourcing investment management is on the rise. He goes on to argue those numbers will continue to grow as advisors focus more on financial planning as part of their value proposition.
Pinnacle Advisor Solutions recently hosted our third Annual Strategic Partners Forum where our partners and Pinnacle colleagues gathered together to share ideas, reflect on the successes and challenges of the past year and look ahead to things to come. As I looked around the room and saw how our numbers have grown over the last several years I was reminded of Kitces’ recent blog and what brought our partners to us originally.
Our partners are from all over the country, most are solo practitioners with few or no staff and engaged with Pinnacle for a variety of reasons, the most common – time. Time to grow their business, time to spend with their families, time to spend with clients, time to quickly breakaway and start their own firm.
Our very first Strategic Partner had reached capacity trying to run his firm while raising two kids. He had no time to take on new clients because he was consumed by the day to day chores of operating the firm. In addition, he had managed his client portfolios during the downturn in 2008 and had decided that he needed to find a more risk-managed approach. Initially, Pinnacle took over the investment management of his clients’ assets and later when we introduced our back-office offering, he was the first to sign on for our solution. All in all, he estimates that his partnership with Pinnacle has freed almost 50% of his time. Time he now has to pursue new clients and to spend with his family.
A more recent advisor to partner with Pinnacle first contacted us as he began to explore how to go about breaking away and establishing his own firm. Pinnacle put him in touch with AdvisorAssist, a leading national compliance firm with whom Pinnacle works as part of our operations offering. AdvisorAssist helped him establish his RIA and Pinnacle provided invaluable assistance in aiding him move his clients to his new firm. With Pinnacle managing his client portfolios, he has been able to add new clients as well as a second advisor to his program.
A solo practitioner who had been her own boss for 30 years realized she was in need of more support. She began to weigh her options investigating both selling her firm or outsourcing. She chose to outsource the investment management to Pinnacle so she could remain independent and continue to work with her clients. With the time she freed up she was able to return her focus to planning with her clients. In addition, with Pinnacle’s help she increased her marketing efforts and new business development. Today she is beginning to give thought to her eventual retirement and is considering adding our back-office solution to her agreement.
Those are just a few of the stories of why our Strategic Partners chose to work with Pinnacle but all of our partners ultimately elected to outsource to free up time. Outsourcing leaves them more time to focus on their clients, growth and lifestyle.
