Registered investment advisors should offer robust internship programs and emphasize cultures of service to attract young talent to the industry, according to participants in a Focused on the Future Think Tank roundtable discussion Wealth Management EDGE on Tuesday at The Boca Raton resort in in Boca Raton, Fla.
During the roundtable, Suzanne Siracuse, CEO of Suzanne Siracuse Consulting Services, led a discussion with three financial planning majors, either in college or recently graduated.
Jenna Smith, a personal financial planning major at Utah Valley University, said her internship at an RIA has been crucial in giving her an idea of what it’s like to work as an advisor and in other roles in the industry.
“I worked at a smaller firm, so I got to work with each of the different advisors, do operational work and see the planning side,” she said.
Amery Johnson, another student at Utah Valley University, said she went to a financial planning academy one summer, which put her on the path to majoring in the field. She has interned at a large RIA and said it has benefited her and her other interns to “shadow and see the actual experience of an advisor to help point us in the direction we want to go.”
Jared Rhein, a recent graduate of Michigan State University, had been initially considering a career in medicine. Then he noticed the strong work/life balance a career in financial advice had given a friend’s parent.
“I ultimately found out he was a financial advisor for Merrill Lynch, which drove me down the broker/dealer path,” Rhein said.
The financial planning majors called out the importance of firms supporting them and peers through paid internships, mentorship programs and professional training. The advisor leaders at the roundtable session all raised their hands when asked if their firms offer paid internship programs. Siracuse said such programs are often the exception, not the rule, and that the wider RIA sector has a long way to go to attract talent to an aging industry.
“What we are trying to do is shine a light on the importance of some of these areas so that we do attract talent to our profession,” Siracuse said. “It’s in everybody’s best interest.”
Siracuse also presented the results of a survey of 85 students in the Finserv Foundation’s fellowship program.
According to the survey, which was co-created by RIA consultancy FPTransitions, 72.9% of students are interested in shadowing a financial advisor, 71.8% want to attend networking events and panel sessions and 69.4% are seeking internship or early career opportunities.
When asked about the top reasons they are interested in the advice industry in general, students cited “helping people reach life goals” (70.9%), work/life balance (67.1%), and long-term earning potential (55.7%).
The survey also, however, echoed what the three panelists said during the roundtable: that a firm’s culture and positive activity in its community also mattered to them.
Mission Focus
In the survey, a mission- and purpose-driven culture was cited as important for a career landing spot among 58% of respondents, which was the most responses on the list.
Smith echoed that sentiment, saying she was interested in seeing firms that do pro bono work to help people who don’t have a large asset pool to budget and plan.
“I’d really like to see a firm that is working with people who aren’t just adding to AUM,” she said, noting that she hadn’t seen much of that in the industry to date.
Roundtable participant Lara Galloway, the recently appointed head of growth at Elevation Point, said the push toward financial wellness may be one approach that will serve a broader base of people, regardless of assets.
“We’re seeing that more and more in the industry, which could be a path for this type of planning,” she said.
Another roundtable participant, Toussant Bailey, managing partner of Uplifting Capital, emphasized the importance of RIAs embracing a firm’s purpose and values to attract talent.
For the next generation, “there is the desire to be more than just a money maker, whether for you or your client,” he said. “Philanthropic activities matter—young advisors want to feel life aligned, not just investment aligned. There are opportunities for conversations across generations when you put values on the table.”
College graduate Rhein also emphasized the positive relationship that can develop when senior and junior employees are paired together. He noted that interns can also bring new ideas and insights and encouraged employers to cultivate a space where the younger generation has a voice.
“I’d like firms to gather all the ideas of their interns and discuss them,” he said. “That would give them an opportunity to build on that for the future.”
Future Growth
Roundtable attendee Brent Brodeski, founder and CEO of Savant Wealth Management, said the importance of generating organic growth for the RIA industry. However, there is also the sense that, among the younger generation, “it can be hard to find people who are excited to sell.”
The panelists agreed that selling in the old-fashioned cold calling sense may not be attractive, but that didn’t mean they or their peers weren’t interested in bringing in new clients.
Johnson said she did not see herself as a salesperson, but more of a financial consultant. She has realized, however, that “when you get passionate about something and you see the ‘why’ of it, you naturally want to sell …. my salesy side is actually just building trust with people around me.”
She encouraged firms to help young interns or staffers become passionate about the industry first, as this is a path to generating new clients, instead of stressing a sales checklist.
During the roundtable, RIA leaders also broke into groups to discuss cultivating a future advisor pipeline. The leaders noted the importance of well-run and dedicated internship programs and firms focused on advancing technology and holistic services.
RIAs would do well to offer full-year, paid internships with mentorship, shadowing, and career pathing, said Amy Boyer, managing director at Mariner.
Phillip Hecker, co-founder and CEO of Bento Engine, agreed, but said that may not be possible for smaller RIAs. If that is the case, he mentioned holding short, even two-week internships, so students can at least get “a flavor” for the industry.
The group also stressed the importance of firms expanding into holistic services and offerings. Shannon Spotswood, CEO of RFG Advisory, said firms should go beyond estate and tax strategies to advise on managing healthcare and family care.
“There’s a significant amount of uncharted waters for advisors to expand their offerings,” she said. “It’s exciting, but there is a lot to be done in these areas.”
She said that technology will also play a significant role in advisory firms, with the ability to text and communicate digitally with clients.
“No next generation client is going to want to be on the phone,” Spotswood said.
Rhein expressed the sentiment that financial planning students are hungry to learn and gain experience if the opportunities exist.
“These are the years of learning, not earning,” he said. “You are trying to learn the best that you can so that in the future you can do the best for your clients. … Structured programs would help accelerate that and improve the workforce at each of your companies.”
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