What does a wealth business transition look like? 5 key factors to consider.

The right third party wealth business provider can empower financial institutions and their advisors to access state-of-the-art technology, improve client engagement, ease compliance burdens, and scale their programs. But before they can achieve these benefits, institutions and their providers must first achieve something else: a successful transition.

The inherent complexity of wealth business transition — onboarding advisors, migrating account data, connecting systems and keeping clients updated along the way — can make it a challenging and even intimidating endeavor. But the right provider can streamline complicated processes and offer steady support to ensure a smooth event.

At LPL Financial, we have a decades-long history of transitioning and onboarding banks, credit unions, and insurance firms on to our industry-leading platform.

Five Strategic Takeaways for Institution Wealth Leaders

When embarking on a relationship with a new provider, institution wealth leaders should keep the following five takeaways top of mind:

1. The foundation for client-centric solutions is built during the transition.

During a well-executed transition, a provider’s onboarding specialists focus on the unique needs of the institution. These needs and pain points are used to tailor the relationship, including but not limited to; selection and implementation of outcome-focused investment software, technology solutions, and bespoke training programs.

2. Data quality affects the pace and the ease of the transition.

Organized, easy-to-import data tends to smooth and accelerate a transition, while disorganized data and outdated records systems can slow the process. The latter is, in fact, a common challenge and a major reason that institutions seek wealth management support in the first place.

Fortunately, veteran transition specialists can leverage both their experience and automation tools to help extract and transfer data from legacy systems — all while minimizing disruption to everyday operations.

3. Meticulous reviews yield the best results.

In a well-executed transition, institutions will find their staff working closely with their wealth business providers to review and re-review advisor and client data during carefully crafted, step-by-step procedures. These meticulous reviews ensure accuracy and effective conversions.

Such reviews can also serve as an opportunity to evaluate books of business and the quality of client relationships. In many cases, advisors may realize that segmentation or changing their client model is in their best interest — and switching platforms is a convenient time to make that change.

4. Comprehensive training on platforms is a must.

The right wealth business provider will implement comprehensive training on the platform and tools adopted by the institution. Multiple levels of training, including access to a proprietary training environment — a sandbox — can ensure that advisors get the experience necessary to feel comfortable with new technologies. A high-quality sandbox helps advisors and staff practice navigating the platform, preview reporting tools, and preview end-client views.

5. Regulatory approvals determine how long a transition lasts.

Regulatory approval is what some call “the long pole in the tent” of wealth business transitions. Standard FINRA reviews of Continuing Membership Applications (CMAs) can take 180 days; during this period, the agency may request additional information to factor into its decision.

The right provider can support institutions with compliance services, helping them maintain the data and documentation necessary for regulatory approval.

The right wealth business provider can make the difference between a smooth transition and a bumpy one. At LPL, we pride ourselves on our time-tested methodology and white-glove service.

Our specialized team offers personalized, ongoing support every step of the way, including training advisors, migrating accounts and communicating with clients. We minimize the impact of the transition on daily business, and we provide access to our in-house analysts for timely insights during the transition and beyond.

Connect with us to learn how transitioning to LPL Financial could work for you.