It hasn’t been widely reported, but there is an ongoing problem at Edward Jones. They have an LPL problem; a serious LPL problem. That problem has syphoned nearly $2B in client assets away from Edward Jones and into the hands of LPL.

Edward Jones advisors and their culture are known for a specific setup, a specific type of trainee, and a small town emphasis. As the industry continues to adjust (most importantly adjusting to include bigger and bigger teams) the Edward Jones model is seen as outdated by some of their larger producers.

The ‘extras’ that include vacations based on production levels, autonomy, and diversification bonuses simply stop adding up once advisors pass the $1M in production. The different levels of expected support and service are also capped out based on Edward Jones’ model. Growth beyond $1M in annual production requires more a la carte type services for larger clients, which simply our outside the scope of Edward Jones’ mass affluent model.

By the numbers, Edward Jones loses nearly $100M every month to LPL over the past 20 months. Reminder that Edward Jones doesn’t have a meaningful policy for recruiting seasoned advisors. That means that the scales are tipped in a big way towards LPL; thus the constant stream of larger Edward Jones advisor departures.

Adding unseasoned trainees isn’t the answer. LPL knows the advantage it has, payout and support; the trend will continue.