Last month I discussed how hiring young breakaway brokers can be a great way for you, as an independent advisor, to capitalize on new opportunities and grow your practice. What's more, younger advisors are very interested in transitioning to the RIA model. Based on our recent survey of advisor attitudes, "Advisors Turning Independent," advisors under the age of 40 were significantly more likely than those 40 and over to find the idea of becoming and RIA appealing (65% to 43%).
Opportunityand interest alone are not enough. You need to take the right steps to find, attract and ultimately hire the right young advisor—one who is both highly qualified and a great fit for your business. With that in mind, here are some key considerations and tips that can help you recruit top young talent looking to enter the RIA world:
Tip 1: Tap new technologies and traditional methods to source candidates.
LinkedIn, Facebook and other social media outlets let you cast a wide geographic net, potentially giving you a large and diverse pool of job candidates. And since younger generations can be heavy users of these channels, you can be very effective at getting your name out in front of under-40 advisors by using social media in your recruiting efforts. That said, the more traditional sourcing vehicles also remain highly valuable. Professional associations and certification boards, which offer networks through which you can advertise yourself, as well as alumni associations are highly effective at connecting young job seekers with employers.
Tip 2: Emphasize your firm's unique culture and values.
Young advisors have become increasingly disenchanted with their employers' corporate cultures. Our survey revealed that advisors under the age of 40 are far more likely to face challenges with their current firm than their older colleagues. That means you can attract strong candidates from this group if you clearly communicate your firm's independent culture and approach during all your interactions with candidates. In particular, emphasize any of your specific values or guiding principles that resonate with the under-40 set—such as flexible scheduling and the importance of a good work-life balance.
The key is to communicate your specific culture and beliefs honestly and consistently at every contact point a new hire could potentially have with your firm. That includes your website—62% of advisors tell us that they would conduct Internet searches to learn more about an RIA firm if they were approached by an RIA recruiter—as well as other professionals who belong to the same professional associations as you.
Even your office itself can send a powerful message about your culture and values. For example, if you purport to be a family-oriented firm, your décor should reflect that focus. One such firm I work with has a children's play area and pictures of employees with their families prominently displayed on the walls. By reinforcing who you are and what you stand for at every interaction in the recruiting process, you'll find candidates who share your values and would be an ideal fit at your firm.
Tip 3: Highlight your solutions to young advisors' biggest professional challenges.
Many younger wirehouse advisors today see significant professional challenges blocking their path to success. For example, two-thirds (67%) of advisors at large firms we surveyed told us that there is generally less job security for them than there used to be. Additionally, today's under-40 wirehouse advisors report three main challenges in trying to help their clients: too much pressure from their firms to grow their books of business (76%), losing assets to other advisors (58%) and too much emphasis on proprietary products (50%)
That knowledge gives you an opportunity to market your firm as the solution to those challenges. For example, by highlighting the RIA model's client-centric approach you'll appeal to the 74% of young advisors who tell us that they believe smaller, independent firms are indeed more client focused. Younger advisors are drawn to this messaging at a time when loyalty to the wirehouse environment has eroded. Consider, for example, that 45% of advisors tell Schwab that employee morale at their firms has worsened during the past five years—while just 17% say it has improved.
