If you ever feel like there just aren’t enough financial advisors out there to meet the demand of retail investors, just know that it isn’t in your head.
If you ever feel like there just aren’t enough financial advisors out there to meet the demand of retail investors, just know that it isn’t in your head.
Researchers at Cerulli Associates found that the number of new advisors joining the industry just barely offset the number of trainee failures and retirements. With 37.5% of advisors expected to retire over the next decade, the advice industry “has a headcount problem,” Cerulli concluded. 1
Of course, just about everyone wants to build a team that can achieve sustainable business growth. It’s often easier said than done to actually assemble that team.
If RIAs want to make the right hires to help position the firm to capitalize on current growth opportunities, there are a few specific things they can focus on, according to Carolyn Armitage, Founder and CEO of RIA Circle and Wealth Management Consulting, in this edited excerpt from the Synergize podcast.
Carolyn Armitage, Founder and CEO of RIA Circle and Wealth Management Consulting: “The most important thing [for either building a team or retaining talent] is having a vision or a mission; having a strategy to get there; and having guiding values, or non-negotiables, for the process and path along the way.
These elements, which may not seem necessary from a hiring perspective, are absolutely important in bringing on and retaining employees. Advisors want to know that there's a purpose beyond just processing whatever business they’re doing so that they can be fully committed. Why are we doing this? Where are we headed?
Number two, I would say, is to best utilize your resources — on the people side as well as with technology.
On the people side, this is both your employees as well as your centers of influence, making sure you have the right alignment and you're fully leveraging them. Oftentimes, organizations may have people with a lot of capacity, and that isn't necessarily intentional. It isn't because they're hiring ahead of the curve, it's just because they're underutilized. And then there’s that element of waste with technology: Instead of just buying the latest, greatest technology tool out there, make sure there's alignment with your purpose and that you're fully utilizing your existing tools. Oftentimes, I'll see firms with a couple of CRMs, for example, and neither one of them is being used to its full extent.
Thirdly, I would say you really need to know yourself as a leader. I know that might sound strange, but as a CEO, the more authentic and self-aware you are, the more you'll be able to appreciate others' differences and the value that they bring to the organization. And you will intentionally hire others that don't have your skill set. Instead of just hiring people that you like or people that are just like you, you actually need differentiation to maximize the value and the optimization of your organization.
The last thing you want is to be like the emperor who has no clothes. You don't want to surround yourself with “yes” people. You want to surround yourself with a variety of thoughts and opinions to be able to have all perspectives in place to make the best decisions for your organization moving forward.
The Synergize podcast explores the evolving role of the financial advisor in an emerging AI-driven world. TradePMR Chief Client Growth Officer Bill Coppel and Senior Editor Ryan Neal bring together thought leaders and industry experts across a range of disciplines, sharing insights designed to help registered investment advisors thrive in the industry of tomorrow. Listen and subscribe for free on Apple Music, Spotify, and YouTube.
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¹The Financial Advisor Industry Has a Headcount Problem, Cerulli. Published Jan.16, 2024.