Recently I’ve been reading and hearing a lot about career paths and career development for the financial planning profession. Financial planning has now reached adolescence and there should be questions regarding this issue.

What should the expectations be for new entrants into the profession? What should the obligations be for those who have built the profession to where it is today? Tough questions! While I do not have all the answers, I have a few observations that could add to the dialogue.

The roots of the profession are in entrepreneurial sole practitioners who left insurance companies and wirehouses to practice in a new way. They had to build most of what they used themselves: software, data books, processes, and systems. What they were not–and are not–particularly good at is building those practices into businesses.

Although financial planning is a profession, it needs to act like an industry. A financial planning industry would have various business models where new entrants could spend time as apprentices learning their trade. Book knowledge alone does not a financial planner make. There would be clearly identifiable career paths with regional firms, local firms, loose partnerships, and large entities.

Acting more like an industry will require mentorship at all levels of career development. Planners must be willing to share business models and to accept the responsibility for their success. Coaches who can show planners how to develop these models are necessary. This is because planners themselves are like physicians: They care deeply about their clients and what they do, but sometimes they just aren’t very good business owners.

The FPA’s Role

The Financial Planning Association has gone a long way in developing programs for entrants into the profession, including internship programs, residency programs, testing aids, ongoing technical and practice management education programs, and networking opportunities. But we recognize that this is just the beginning. The FPA now must play a critical role in encouraging coaches, mentors, and leaders to take financial planning from an emerging profession to an industry-like platform with room for the wide variety of business models.

Financial planners themselves–especially ones who own or run firms–must share the burden of building an industry by fostering the development of younger talent. Many financial services industry coaches today advise their customers to shed the bottom 10% or 20% of their client base every year, because the top 20% produce 80% of the business. The concept doesn’t always make sense. Does GM drop the lowest 20% of their automobile buyers every year? No, because they understand that all revenue can be good if they can find effective ways to serve that lowest 20%.

Taking on a junior associate to work with these clients would keep revenue in the firm and provide excellent positioning for future growth. The revenue from these clients could pay a salary for the “junior.” Any new business she brings into the firm could be split between the firm and the junior associate. Over a period of three to five years, the junior associate would earn “equity” ownership with these clients and perhaps the firm itself.

The other advice coaches often give plannis is to add staff as your firm grows. Why not think about “investing” in your business? Hire a junior associate. Bring someone on as an apprentice to do servicing, learn the business, and someday become a revenue-producing member of the firm.

Many veteran members of the profession aren’t doing this because they don’t know how and are concerned about giving up control. Yet, like a great estate planning technique, the family limited partnership, building a business should not mean giving up control. The reality is just the opposite. It gives you back control over your life.

Many planners are reluctant to take on junior associates because they feel they are too busy to do the training that new entrants require. This is where FPA comes back into the picture. FPA can develop training and mentoring programs that will take the burden off the owner/planner. FPA, being a neutral party, should alleviate fears of theft of proprietary information or one firm stealing another firm’s best talent. FPA wants to see financial planning delivered in an advisory capacity through diverse organizations and styles–large and small, boutique and mainstream–so long as the planners share common values and meet high standards.

FPA has restructured and restaffed to transform our work in career and professional development. But this is a job that will require all who participate in the industry to do their part. I include independent practitioners, major financial services firms, the academic community, the CFP Board, and other membership associations. There will be plenty of opportunities ahead for all who desire to contribute to, shape, and practice in the profession of financial planning.

Jim Barnash is president of the Financial Planning Association. He can be reached at jbarnash@lnc.com.