The survey, conducted earlier this year, also found that most of the broker-dealer affiliated advisors feel independent in some way; 56 percent reported feeling “somewhat independent” and 36 percent said they are “completely independent.

Yet 81 percent recognize that their business would be different if they made the switch to become a registered investment advisor. In fact, there was a 45 percent increase in the number of advisor teams transitioning to RIAs from broker-dealer firms in 2010 compared to 2009.

When asked about their interest in RIA firms, 43 percent of broker-dealer advisors cited greater ability to develop and grow their own business, 42 percent said they’d be able to deliver more customized solutions, and 41 percent chose the capacity to hand pick their own team.

“Advisors with independent broker-dealers saw these as huge potential benefits to joining or starting an RIA firm,” Davis said.

One of the major things holding advisors back from making the RIA transition is the economy; 45 percent say that a friendlier economic and tax environment for small business owners would increase the likelihood that they’d make the switch, while 43 percent cited and overall improved marketing and economic environment.

Additional survey findings include:

• Fifty-eight percent of advisors would prefer to join an existing firm, while 34 percent would prefer to start their own.
• Eighty-two percent of independent broker-dealer advisors’ assets under management are currently in a fee-based model. Forty-five percent of advisors say their long-term plan is to be mostly or all fee-based, while 46 percent indicate they expect to maintain a mix of both commission- and fee-based business. Only 8 percent of advisors say their practice will be mostly or all commission-based.
• As cited by advisors, the two biggest advantages to a fee-based model are providing an easier to understand pricing model for clients (62 percent) and having greater predictability in revenue (61 percent).