As the year draws to a close, financial advisors contemplating a switch to a new broker-dealer are likely asking themselves one pressing question: is there enough time to make a move before the end of 2024?

Transitioning to a new broker-dealer can be a complex and time-consuming process, involving everything from due diligence to the actual transfer of accounts. With the year-end deadline looming, it’s crucial to weigh the benefits and challenges of making this transition now versus waiting until 2025. Here’s what you need to consider.

Is It Still Possible to Move in 2024?

The short answer is yes, but with only a few months left in the year, the window is rapidly closing. A transition can take anywhere from six weeks on the very rushed end to a few years for larger practices. Timing depends on many factors, including the complexity of your practice and the level of support you receive. However, motivation can play a significant role in expediting the process. If you’re determined to move before the new year, there may be some compelling reasons to do so—not the least of which is keeping tax year records cleaner.

The Timeline for a Broker-Dealer Transition

Switching broker-dealers isn’t something that happens overnight. On average, a transition can take anywhere from three to six months, depending on various factors such as the complexity of your book of business, the level of support provided by your new broker-dealer, and regulatory requirements.

1. Due Diligence and Research (1-2 Months)

The first step in any broker-dealer transition is conducting thorough due diligence. This phase typically involves researching potential new firms, comparing their platforms, fees, compliance support, technology offerings, and overall culture. It’s also essential to speak with other advisors who have made similar transitions to gather insights and recommendations. This process alone can take one to two months, especially if you’re considering multiple firms.

2. Negotiation and Contract Review (1-2 Months)

Once you’ve selected a potential new broker-dealer, the next phase involves negotiating your contract and reviewing the fine print. This stage is critical, as it ensures that the terms of your new affiliation align with your business goals and client needs. Legal review of contracts, negotiating terms, and finalizing agreements can easily take another month or two, depending on the complexity of the deal and the responsiveness of both parties. Having a consultant on your side who sees 100’s of deals each year and can offer you guidance on how to increase your package is critical.

Advantages of Lining Up a Move with the New Year

As we turn the page on summer 2024 and set our sights on fall and winter, the question of whether to move now or wait until the new year becomes more frequent. Aligning your transition with the new year offers several benefits:

1. Financial Incentives and Year-End Bonuses

Many broker-dealers are offering outsized packages for top talent as the year draws to a close. If you start now, you could take advantage of these competitive offers, which might include significant signing bonuses, higher payouts, or other financial benefits that might not be available in the new year. Additionally, year-end bonuses will soon come into play, meaning you might have timed this perfectly.

2. Strategic Alignment

If your current broker-dealer relationship is hindering your ability to grow your practice or serve your clients effectively, delaying the move could mean another year of missed opportunities. Transitioning now could position you to hit the ground running in 2025 with a broker-dealer that better supports your strategic goals.

3. Cleaner Tax Year Records

One practical reason to consider moving before the new year is to keep your tax year records cleaner. By aligning the transition with the calendar year, you can avoid complications that might arise from splitting financial records across different broker-dealers within the same tax year.

Suggestions for Advisors Who Want to Move in 2024

With just a few months left in 2024, here are some practical steps to consider if you’re determined to make the move before the end of the year:

Start Now

Reach out to a transition consultant, such as 3xEquity, to begin discussions immediately. Transition consultants can secure multiple offers for you, all while you remain 100% anonymous, in just a few days. With this information in hand, you can begin thinking about the financial incentives of the undertaking, which right now should be fairly strong.

Block Time to Make the Best Decision

While the timeline is tight, you don’t want to rush the decision-making process because of the calendar. Although we aren’t in “two-minute drill” territory yet, it’s essential to block time on your calendar for the big discussions and think sessions necessary to reach the best decision for the long-term future of your practice.

Leverage the Skillset of a Transition Consultant

You likely aren’t an expert in transitions, and a transition consultant can help keep everything moving on a fast track. From setting meetings to negotiating the best package possible, a transition consultant can be a crucial ally in a successful transition. Plus, their services are offered free to financial advisors, so there’s almost no reason not to leverage their expertise. A transition consultant can help smooth your path forward.

Is There Enough Time?

So, is there enough time to switch broker-dealers before the end of 2024? The answer depends on your specific situation. If you have already started the process or are well-prepared to move quickly, it’s possible to complete the transition by year-end.  regulatory requirements, it might be more prudent to plan for a transition in early 2025.

Each year, hundreds of advisors trust the expertise and proven processes of transition consultants like 3xEquity to secure multiple offers, identify the most promising opportunities, and transition smoothly and efficiently. If you’re contemplating a move to a new broker-dealer visit 3xEquity.com and let us help you hit every green light on the road to your next chapter of success.