% Recurring Revenue

On average, the industry recurring revenue percentage is 74%. With all things DOL, there has been a recent shift away from non-recurring (or commission) revenue – one that I believe will continue. Simply put, recurring revenue is more valuable because it’s more reliable.

Ideally, a Practice’s recurring revenue should be 80% or more. Additionally, a diversified revenue stream is highly attractive. Advisors that charge for financial planning enjoy a revenue stream that isn’t tied to the market – and that has a huge, positive impact on valuation.

Start shifting your business model away from non-recurring revenue and focus more on a fee-based one.