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by Joni Youngwirth

As a growing number of advisers leave the industry, with fewer new advisers coming along to fill their shoes, mentoring is getting a lot of attention. Most experienced advisers have a positive perception of mentoring; many remember well the wisdom they gained from their own mentors early in their careers. But, before bringing on a junior adviser, it’s important to understand the amount of time and patience that mentoring requires

Recently, I worked with a group of very successful independent advisers, all with seven-figure production, who were in the process of developing junior advisers (also called associate advisers). The advisers participated in a year-long program involving three workshops, peer groups for the junior advisers, and a series of coaching calls before, during, and after the workshops. Here, I’ll share some of the mentoring best practices that evolved from those sessions.

Take an Inventory

What assets does the junior adviser bring to the mentoring situation? Some juniors may have a CFP certification and necessary registrations, three to five years of experience, and a working book of clients; some may have none of the above. Beyond the obvious questions, more subtle factors to inventory include the junior’s skills in areas such as prospecting, time management, and developing tight relationships with clients.

To help get a baseline assessment, both the junior and the senior advisers can complete the same interview about the junior’s competencies. In addition to providing a snapshot of areas the junior needs to focus on, the results may reveal differences in perception between the junior and the senior that should be discussed. Tools such as the Kolbe indices and the Predictive Index can help round out the exercise, offering insight into each party’s personality and work style. The inventory phase is often most successful when the interviews and assessments are conducted by an unbiased third party.

Align Expectations

One of the biggest challenges for senior advisers is expressing exactly what they expect of the junior adviser. Some of the ambiguity stems from the fact that, as discussed above, juniors start the process at different places. Some have come through four-year financial planning programs, some are mature career changers, and others are family members of the senior adviser. From the junior’s unique starting point, the senior adviser must articulate where he or she is headed in the next year, the next three years, and long term.

Keep in mind that, although both the senior and junior adviser may come into the experience with one set of expectations, their views may change as they learn more about the industry and each other. For example, over the next three years, which of the following will the junior adviser become:

  • an adviser capable of bringing in new clients and servicing them,
  • a service adviser who takes over work with small clients,
  • a service adviser working on A and B clients with the lead adviser, or
  • a successor of the business?

In addition to defining the junior’s role at the outset of the relationship, be sure to check in from time to time to ensure that you’re still on the same page.

Set SMART Goals

Based on the considerations outlined above, junior advisers’ individual goals may vary widely. But, whether you want the junior to bring on new clients, adopt a consultative process for interacting with existing clients, or learn to run the business, the goals you set should be specific, measurable, achievable, realistic, and time-bounded (SMART). Simply creating and agreeing to the goals can have a dramatic effect on whether the junior adviser reaches those goals or not.

Using SMART goals also can make it easy to track the junior adviser’s progress. Having a group forum for the junior to present his or her work can emphasize the importance of the goals while providing an opportunity to give deserved recognition when milestones are met.

Prioritize Communication

A junior adviser is like a B client with the potential to become an A+ client—to get results, you need to invest time. In order to thrive, junior advisers need regularly scheduled talk time with their mentors. Treating communication as an afterthought, something you’ll get to when all the other client work is done, is bound to hamper the junior’s progress. Planning one hour-long meeting per week is a good starting point.

Speak the Same Language

The more expansive your expectations for the junior adviser, the more you need a common language to convey instructions and feedback. For example, if the junior will take over some of your smaller clients, you need a language for the consultative process. (This may or may not mirror the CFP certification’s language for the consulting process or that of other external training.) Keep in mind that the language doesn’t need to be sophisticated. One adviser in our group described his firm’s consulting process in four simple phases: connect with the client, find the holes in the client’s current situation, fix the holes, provide service, and repeat.

Additional languages may be necessary if you also expect the junior adviser to bring new clients to the firm or to become your successor. In those cases, you’ll need a common language for rainmaking and for running the firm as a business, respectively.

Leverage the CFP Program

Of course, the junior needs to gain expertise in the financial planning process, including specific knowledge of insurance, retirement, estate, tax, and business planning issues. Pursuing the CFP certification can be a great way to acquire this background. The CFP certification offers a defined curriculum, evaluations, and even a reward at the end—the opportunity to use a recognized credential. Instead of spending your valuable time teaching this content, you can elaborate on the fundamentals, highlighting the areas of greatest importance in your firm. The CFP certification is a huge resource for mentors, even if they don’t have the credential themselves.

Enlist a Village

What struck me most about the sessions I led was the degree to which the advisers bonded with each other. Just as “it takes a village to raise a child,” the group embraced the idea that “it takes a group to develop a junior adviser.” Each senior had a genuine interest in the progress of each of the juniors, and each junior had many mentors to call on, in addition to the mentor from his or her own firm. In some cases, it was easier for a junior to hear feedback from a mentor other than his or her own. In addition, presenting their progress to a group of mentor advisers at each workshop was a unique opportunity and responsibility for the junior advisers.
As for the results, the juniors who participated in the program clearly grew in knowledge and stature. From the way they carried themselves to their confidence presenting accomplishments, the short-term results of the village approach were overwhelmingly positive. We can’t, of course, assess the long-term results yet. As time goes on, the questions will be:

  • Does the junior have the finesse to nurture each client relationship while guiding the client toward wise financial decisions?
  • Does the junior have the chutzpah to bring on the kind of clients that will make the firm successful?
  • Will the junior master the ability to manage time and talent, efficiently addressing multiple needs?
  • Is the junior capable of managing a business in addition to being a financial adviser?
  • Is the junior on track to become a seven-figure producer like his or her mentor?

Becoming a successful adviser doesn’t happen overnight, even with a solid training initiative. Think about it: how long did it take you to develop your skills? In fact, if we’re lucky, we continue learning and growing every day. A pleasant surprise of the village approach was that the senior advisers in the program may have grown nearly as much as the juniors, proving that it truly is better to give than to receive.

Joni Youngwirth is the managing principal of practice management at Commonwealth Financial Network®, member FINRA/SIPC, a registered investment adviser, in Waltham, Massachusetts. Email Joni Youngwirth.

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