Take any 10 financial advisors today, and there’s a good chance that four of them will retire over the next decade—that’s more than 100,000 advisors out of the workforce within 10 years.

For the industry to continue to thrive, we need to actively look beyond fresh college graduates. With roughly140 CFP-registered financial planning programs in the country, these programs are not producing enough talent to sustain the industry. We need to cast a wider net.

Future advisors—what we call Generation Next—needs to include younger generations, but also anyone who isn’t in the field already. This includes nontraditional graduates, people coming back into the workforce after caring for parents or children, veterans and other career-changers from a wide array of backgrounds and experiences.

Sharing Perspectives And Experience

A common joke is that hiring younger workers means always having in-house tech support. But this stereotype sidesteps the broad capabilities and potential that these workers present, as well as the other experiences and abilities Generation Next can bring.

We need more advisors not only to replace those who will be retiring, but also to help a growing population manage its money wisely. We don’t need to replace advisors in the middle of their careers; we need to attract more new ones who can work with and learn from older generations. We don’t need to hire fewer men; we need to hire more women. Weeding out current perspectives isn’t the goal; having a broader range of perspectives and encouraging inter-generational collaboration and overall inclusion is.

Recruiting advisors with different backgrounds presents a tremendous learning opportunity for new and existing advisors alike. The wisdom older advisors have earned through experience provides an invaluable perspective. Pairing new voices with existing ones means those with more experience can teach nuances to newer advisors like how to navigate tricky situations, which ultimately strengthens the firm as a whole. Simultaneously, new hires can bring outside experience that enhances the firm’s offerings and mission, as well as potential new clients.

Building The Firm Of Tomorrow Today

In addition to making sure there are enough financial advisors, we need to make sure there are enough clients to keep our profession healthy.

Many of the advisors I talk to recognize this need but are comfortable with the status quo. When these advisors near retirement, they see little value in changing the way they’ve always done things to invest in a future they won’t have to worry about managing. According to the 2018 FA Insight study Growth By Design, 90% of RIAs have 50% of their clients in distribution mode, meaning a firm will have limited growth potential unless it is also growing by adding younger clients, and the services they need. In 2017, firms that put greater focus on the under-55 market added clients at double the rate of firms that did not, as well as seeing significantly higher revenue and AUM growth compared to firms with an older client base.

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