Something’s amiss in the financial advice business and the data confirms it: Women account for only about 15% of the financial advisor population, according to McKinsey, and only 23% of CFPs.

Since research has shown that diversity on our teams, just like diversity in a client’s portfolio, produces better results, why is the needle moving so slowly to attract and retain more women advisors and what can be done about it?

The industry has made great strides in recent years in recognizing this imbalance and trying to change it. As those industry-wide efforts continue, firm owners and partners also can do their part. Here are a few key recommendations based on our own success at Merit that can make your firm more appealing and rewarding to women.

Rethink Advisor Compensation By 'Teaming'
One major area that I have found tends to turn women off about becoming an advisor is the industry’s compensation structure. In most cases, comp plans are directly tied to business development and production. While these, of course, are key drivers, they certainly aren’t the only factors that should be measured and incorporated in determining the success of an advisor. 

Recognizing that the advisor’s job is multi-dimensional has been behind changes I’ve helped make at our firm. These changes have driven efficiency and growth, improved client and employee satisfaction, increased profitability and, at the same time and most importantly, attracted more women to our firm and encouraged them to stay.

You can make similar changes at your firm. Start by truly appreciating that no one person is outstanding at everything. Expecting an advisor to be terrific at all the many diverse tasks the job encompasses is unrealistic—which is why the attrition rate among new advisors traditionally has been so high. People are most satisfied and productive when they do what they do best.

Next, carefully enumerate the tasks you expect an advisor to do. Typically, these might include prospecting for new business, holding client and prospect events, maintaining contact with existing clients, preparing and reviewing financial plans and creating portfolio allocations.

At our firm, we have created specific jobs for many of those tasks. The jobs all come under the umbrella of “advisor,” but each person does the one for which they are best suited, working as part of an advisory team.

Take prospecting. Marketing oneself is a task many advisors neither love nor have the experience to do well. At our firm, we have taken that burden off the shoulders of each advisor by creating a dedicated marketing group that handles our social media activity, email campaigns, content creation and promotion, direct mail, sponsorships and events. We invest 20% of our revenues in marketing, freeing advisors’ time and energy all while delivering them qualified leads.

Because comp plans are traditionally designed to reward closing new clients, the work of serving and retaining current clients often has taken a backseat. But since retaining satisfied long-term clients is the key to firm success and profitability, we have created dedicated advisor teams that focus solely on client service. These teams regularly check in with clients and answer questions that may come up.

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