Updated Sunday, September 21, 2014 as of 6:13 PM ET

Memo From the Boss: 5 Things I Wish I Could Fix in New Advisors

JUN 5, 2013
9:44am ET
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This previously published article is part of 12 Days of Wealth Management: The Year in Review.

Financial planning firms are constantly under pressure to do more with less to keep up with client demands, industry developments, and economic circumstances. This requires top performance from everyone in the firm especially new hires, but this can be difficult due to the combination of unclear expectations, lack of structured training, and limited formal mentoring.

When this happens the relationship is strained, leaving the employee confused and employer frustrated. To help alleviate some of this tension, new planners should be aware of these commonly cited irks by firm owners and take the necessary steps to avoid them.

1. Lack of Initiative

Once you walk across the stage to receive your diploma, say goodbye to the days of rote memorization, regurgitation, and being spoon-fed all information needed for problem solving.  Firm owners become easily frustrated with new employees who cannot think critically and develop and defend a solution. I often get asked why new college grads wait for their employers to tell them exactly what to do. Among other things, I tell employers that it likely stems from the fact that you are afraid to make a mistake, probably because you haven’t been given the proper training.  An informal poll of some of my clients affirmed that most firm owners would prefer you ‘take a swing’ and miss versus not taking a swing at all.

Takeaway: A good manager will set up situations for you to take a swing that won’t adversely impact the firm if you strike out. However, not everyone is a good manager and in these instances try asking your firm owner, “Do I have your permission to fully run with this? If so, here is the direction I was thinking about, do you have any other suggestions?”

2. Unclear Passion

Firm owners want to see tangible signs that you are truly committed to the financial planning profession and not merely trying it out on their dime because it looks fun. Realize financial planning is a difficult career; you will experience hardship(s) at some point during your career.  Employers are looking for candidates and employees who will overcome and learn from these hardships and not let them keep you from what you love. There is a clear differentiation between employees who work in financial planning to enable them to live versus employees who are passionate about doing financial planning.

Takeaway: Passion for your vocation cannot be taught – you either have it or you don’t.  You shouldn’t spend your life doing something you are just lukewarm about. Get involved in professional associations and community organizations that further your career and promote causes you are passionate about. 

3. Poor Attitude

A degree in financial planning along with passing the CFP examination doesn’t mean you will be a successful financial planner. These are merely starting points for a long journey to becoming a competent practitioner. When you go work for someone else, no matter what your title, you are the “low person on the totem pole.”  Keep a positive attitude, respect other team members who might not have your credentials, learn, and contribute as much as you can.  Also, remember that firm owners have feelings too and started where you started. They want to be valued just like you want to be valued.  If they do something you appreciate, let them know!

Takeaway: Poor attitudes are fueled by egos that stoke the fires of outright arrogance which is detrimental to any team. Remember that you do not know everything, check your ego. One day when it is your company (after many years of hard work), you can do it exactly how you want to.

4.Repeating Mistakes 

Due to the limited time that firm owners think they can devote to employee training and development, they may only be able to show you how to do something once or twice.  This may be your only opportunity to learn so take copious notes, ask questions, create screen shots, and practice a few times on your own if able. Understand that you will probably have limited time with your firm owner and you should strive to maximize it by asking as many questions as it takes for you to be clear on their expectations before telling them you understand. Keep a list of questions to go over during your specified meeting times. Refrain from asking dozens of one off questions throughout the day creating unnecessary interruptions.

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Comments (1)
Interesting article. Having been an employee at a couple of insurance/financial companies and one independent firm, I now have my own practice. Although it is more difficult to be a one-man show, I much prefer it to my previous positions because of the management style and culture. So here's what I would write to those managers.

1. One size does not fit all. Having one way of doing things means that your turnover is going to be large and constant. Everyone is different, and the more you try to make everyone sell the same way, the less success you will have.

2. Awards sometimes have the opposite effect from their intended goal. Having the same senior people get production awards every month or quarter means little to some of the newbies because they know that the senior person's practice is very different from theirs (e.g., support staff, company leads or orphaned accounts, access to tools a newbie can't afford, perhaps a relative who brought them up in the business), so the reaction can be either neutral or resentful because the the guy with the step up is constantly getting the prize.

3. Be careful who you team your newbies with. I didn't have a single mentor who didn't try to screw me, and one manager set me up with a CFA who was his buddy, didn't know the first thing about selling, and was the manager's partner in a DBA that we didn't know about which was a landing place for the orphaned business when newbies left the firm.

4. Be careful who your "experts" are. One office had a senior, top producer who gave presentations about selling who everyone new was one of the most unscrupulous producers in the office. He even screwed his parents, who essentially disowned him because he left them in terrible financial shape as the result of his wanting a sale.

5. Be honest with the newbies. Stop telling people that they will be making $100k in just a few years. There are exceptions, but they are few and far between, and the quick successes usually have a relationship (family members, former employers, or other connections) that are unique to the individual and can't be conjured up. It takes at least three years, and usually five, to establish oneself in the industry, especially if you're right out of school. I knew one newbie who had become engaged right after he had joined the firm. The pressure on him was enormous. he bought the line about how successful he was going to be, and he certainly had the skills to do it, but he quit shortly after he got married because he couldn't afford his new responsibilities.

6. (A bonus suggestion) Carefully cultivate your culture. If the ends justify the means for your advisers, you'll attract people for whom the almighty dollar is paramount and will try to make the sale in whatever way they can. Perhaps that's what you want, but I've been around those people, and it only inspired me to get the hell out of there. When I left the firm, all they had left were cowboys, jocks, and peacocks.
Posted by Kelly G | Thursday, June 06 2013 at 9:53AM ET
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