Going independent
Advisors ask about client data before anything else, and they are right to. It is governed by documents most people signed years ago.
Advisors considering a move ask about client data before they ask about anything else, and they are right to. It is the part that determines whether the transition is orderly or a scramble, and it is governed by documents most people signed years ago and have not read since.
This is general information about how these arrangements commonly work, not legal advice. Employment agreements differ, state law differs, and the industry agreements referenced here have changed membership over time. Engage counsel who does this specific work before you act on any of it.
Before any general rule, the controlling document is what you signed. Read it properly, and read it before you talk to anyone, because the conversation you have with a recruiter is not privileged.
The clauses that matter are the notice period, any non-solicitation covenant and its duration, any non-competition covenant, garden-leave provisions, and the treatment of deferred compensation on resignation. Those five determine most of what your transition looks like.
They are routinely confused and they restrict different things. A non-solicitation clause limits your ability to actively approach clients. A non-competition clause attempts to limit your ability to work in the business at all.
Enforceability varies enormously by state, and non-competes in particular are treated very differently from one jurisdiction to the next — some states will not enforce them against most employees at all. The federal position has also been litigated recently and has not settled into anything you should rely on. This is precisely the point at which general information stops being useful and counsel in your state starts.
Many firms historically participated in a voluntary industry protocol that permitted a departing representative to take limited client contact information — broadly, name, address, telephone, email and account title for clients they personally serviced — and not account numbers, statements, performance records or other firm property.
Two things to understand about it. It was always voluntary, and several large firms have withdrawn from it, which changes the analysis completely for their advisors. Whether your firm participates today, and on what terms, is a current fact to verify rather than something to assume from what was true a few years ago.
Account numbers. Statements. Performance reports produced by the firm. Internal research. Client lists compiled by the firm rather than by you. Anything downloaded from firm systems in the weeks before you resign — which is also the activity most likely to be reviewed afterwards.
The practical rule advisors who have done this cleanly tend to follow: assume every system action in your final month will be examined, and behave accordingly.
Resign first, then contact clients. Reaching out before you have resigned converts an orderly departure into a solicitation claim with documentary evidence attached, and it is the single most common unforced error.
Have your new firm, your custodian and your paperwork ready before you give notice, because the window between resigning and clients deciding is short and it is the only one you get.
Not a pitch. Continuity. They need to know their assets stay where they are custodied or where they are going, what they need to sign, when it happens, and that the person they trust is still the person handling it.
The advisors who transition the highest share of their book are rarely the ones with the best story about why they left. They are the ones whose clients experienced the move as organised.
Questions this did not answer? Ask them directly — that is what the twenty minutes is for.
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