In the last few months, many industry magazines and websites have drawn attention to the shortage of young college graduates entering the financial-planning and investment-advice industry. These same media outlets often focus on the lack of reliable succession plans for the older generation of investment advisors. A recent study found that 25% of today’s advisors are likely to retire over the next decade. Plus, the financial-advice industry will need 237,000 new advisors just to keep up with those retiring reps.
In other words, the investment-advice industry needs young advisors. It also needs these advisors need to build profitable businesses, so they can fund succession plans and buy advice practices of their choice in a few years.
Fortunately, there is a straightforward and logical solution to this industry dilemma, namely a new approach to hiring.
Many advisory firms prefer to hire advisors with established books of business, and advisors with robust levels of client assets, as well as fees and commissions, are able to attract big recruitment bonuses. But why not try a different – and potentially more lucrative – approach?
Experienced investment advisors can hire young and eager-to-learn investment advisor interns without expensive recruitment bonuses. These interns can gather existing client assets that are not currently being managed by most existing investment advisory firms.
New investment advisor interns can be profitable from day one. They can also begin to build the client asset base that can fund a firm’s succession plan in a few short years.
Local colleges and universities offer business internship programs for their students studying for degrees in finance or business, for instance. Plus, my boutique investment-advice firm has hired interns who attend the same local private high school my kids do.
College kids need the chance to learn about prospecting, making presentation, building client relationship and sharing financial advice. These opportunities are the only way college kids can decide if the investment-advice business is right for them.
You don’t have to bet the future of your practice.