Saturday, November 9, 2013

Why young advisers need mentoring

If financial advisers want to build a strong and sustainable business, they need to develop a mentoring program for young employees.

“I've seen a lot of great people wash out of the business in their first two or three years,” Christine Gaze, TD Ameritrade Institutional's director of practice management, said during InvestmentNews' NextGen Virtual Career Fair on Friday. “Our research shows that firms with junior associate programs results in 44% greater income for the owner.”

(Pershing's Dellarocca: Opportunities for NextGen financial planners are growing rapidly)

Guided support helps NextGen advisers find clients in their early years, she said, adding that seasoned advisers should consider taking their junior associates to client meetings to take notes and run analysis until they develop the confidence to take on their own clients.

“The expectation that the junior adviser should be beating the pavement from Day One is inconsistent with advisers' need for succession planning with the next generation,” Ms. Gaze said. “The typical transition to a successor requires 10 years.”

Ms. Gaze took note of Cerulli Associates Inc.'s research showing that the average age of an adviser is 52 and that 26,764 advisers are expected to leave the industry between 2012 and 2017. In light of those statistics, TDAI offers NextGen scholarship and grant programs to attract top talent and promote young advisers.

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