Why Would My Ameriprise Advisor Sell His Clients?
Ameriprise is a financial services company offering insurance and investment products and advice to clients through a network of over 10,000 advisors. As of October 2010, Ameriprise has more than 2 million clients and more than $600 billion in assets under management.
Other People Are Reading
-
Typical Financial Advisor
-
Generally, a financial advisor works independently and receives commissions from the company to whom he directs your business. About 60 percent of all Ameriprise Financial advisors work independently as franchisee advisors. In order to grow their sales and income, they must keep finding new clients and nurture relationships with existing clients.
Advisor Selling his Clients
-
Retirement is the most common reason why an Ameriprise advisor sells his clients. Since the advisor is responsible for providing service to existing clients, if he wishes to see those clients taken care of when he retires, he will sell his list of clients to another financial advisor for a price deemed fair by Ameriprise.
-
Fair Price for Selling Clients
-
Generally the price paid for acquiring the clients of a retiring advisor is a multiple of the ongoing service fees associated with those clients. Any existing client's investment portfolio generates service fees, which are ongoing commissions earned on existing business. The new advisor buying these clients will now start receiving these service fees.
How this Affects you as a Client
-
Your relationship with Ameriprise does not change when your advisor sells his clients to another advisor. Furthermore, you have no obligation whatsoever to continue doing business with the new advisor. This is the risk taken by the new advisor when purchasing someone else's clients.
-
