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Practice Management > Building Your Business > Young Professionals

4 Keys to Retaining Your Advisory Firm’s Best Young Talent

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Every firm needs the right talent in place to achieve their goals. However, a key obstacle in achieving those goals is that many advisors don’t spend time on recruiting and training their employees and realize too late that the lack of talent has become an impediment. 

Last year, we conducted focus groups with successful young advisors for our Future Leaders Study and identified the four things they want from their firm: financial freedom, independence, gratification and flexibility.

These priorities make it evident that while compensation is clearly important, it’s only one component of job satisfaction.  Based on our conversations with young advisors, here are a few things for firm leaders to consider in order to keep their top talent:

  1. Know What Competitors Are Offering
    It’s important for young advisors to have a clear understanding of the potential career paths available to them. Many of them are looking for a transparent path to increased compensation, particularly through equity or ownership. Having candid discussions with them about the opportunities for realizing that goal, as well as offering them assistance with marketing and business development can go a long way toward making young advisors feel like they have the support they need.

    In order to facilitate those discussions, firm management should know which financial opportunities are available at competing firms to help ensure they have a competitive offering for the young advisors they want to further develop.

  2. Offer More Than a Compensation Package Alone
    Advisors we spoke to are not only looking to be paid fairly, but they need to feel the work they do is important and that they have a certain degree of autonomy in performing that work.

    One business that recognized this is Halbert Hargrove Global Advisors. The firm involves staff in all aspects of the business, including the annual strategic planning process and ongoing reviews of company performance. Halbert Hargrove also pays for advisors to receive executive education and professional certifications, matches 529 plan contributions and daycare costs, and has a profit-sharing plan. This combination of benefits has resulted in an increasingly engaged workforce.

  3. Technology Is Crucial

    Technology can also be a draw for retaining the best young advisors. We heard from this demographic that they view technology as integral to their job, and expect their firm to adopt and use the latest technologies. In particular, young advisors emphasized the importance of a strong CRM system. They said keeping up-to-date client records made their jobs significantly easier—and made them more productive when segmenting and targeting clients and prospects.

  4. Foster Relationships Between Young Advisors and Young Clients
    In addition to the ability to use the latest technology, young advisors crave the chance to work with clients in their own age group (Gen X/Y). Clients in that demographic are often in the early stages of their wealth accumulation cycle, so they’re typically not the most profitable for firms.

    One way to help young advisors engage with this demographic is to pair them with already established advisors to work with the children and heirs of current clients. This strategy can pay dividends for the firm as well by helping set up a smooth eventual transfer of wealth that will keep the estate’s assets where they are.

Some young advisors do switch firms for no better reason than a bigger paycheck, but there’s a lot more to job satisfaction than simply take-home pay. Offering autonomy, ownership opportunities, access to the latest technology and continuing education are what can make young advisors eager to stay where they are.  If you aren’t willing to invest in your top talent, a competitor likely will.


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