The US financial advisor workforce is graying. Today, their average age is 51 years old. Given the trend, the industry will soon face a talent shortage. As a growing number of advisors consider retiring or slowing down, firms will need to reconsider the way they operate to attract a younger workforce.
Certainly, older professionals have long dominated the financial advisor community, but the wealth management field is now struggling to redefine itself. According to Moss Adams, the wealth management industry could be short more than 200,000 advisors by 2022.
In order to attract a younger workforce, firms will need to rethink the way they work. Millennial and GenX advisors expect a level of technology that many wealth management firms simply don't have. But firms are finding that needs to change.
A more advanced approach to CRM, financial planning, and G&A functions remains an essential component of the modern advisor's office — and the key to recruitment and retention. Today, recruiting and retaining the next generation of advisors is critical to a firm's growth and succession planning — and improved technology is one way to do that.
Improving profits & recruitment
A strong tech infrastructure remains essential to a successful, efficient and profitable firm and can create more satisfied advisors and clients. In a study by Fidelity Clearing & Custody Solutions (FCCS), tech-savvy advisors posted 42 percent higher assets under management (AUM) in 2016 than their "tech-indifferent" peers, up from 40 percent higher AUM in 2014. They also served more high-value clients ($1 million+) than tech-indifferent advisors. But more importantly, tech-savvy FAs reported more job satisfaction than tech-indifferent advisors.
Outperforming the competition As wealth management firms compete for talent, they can improve recruitment and retention by shedding their stodgy image in the eyes of many Gen Xers and millennials. State-of-the-art technology, which delivers a consumer-like experience for business users, creates improved processes and allows for integrated systems. It also helps firms avoid the common problem of duplicated work, which can be very frustrating for advisors. By optimizing document management, for instance, firms can improve efficiency and move more processes online, creating a paperless environment. It's clear that automated administrative functions help free up advisors to better service clients and generate more leads.
Shaking off the stodgy image
Early fintech adopters have a significant jump on their peers when it comes to client performance, says Bijan Golkar, CEO and senior advisor for FPC Investment Advisory.
