Structure Your Team for Success
The biggest trend in financial advisory firms today? It’s all about people. For the first time in the report’s history, in Schwab’s 2022 RIA Benchmarking Study, “recruiting staff to increase the firm’s skill set and capacity ranked as the top strategic priority” for RIAs of all sizes.
The report found that “based on current growth rates and the number of RIAs, the industry will need to hire more than 70,000 new staff over the next five years” — a number that doesn’t even account for attrition due to retirement, or to advisors who jump ship or leave to start their own firms.
Firm owners clearly see the need for quality staff. But do clients? Despite broad distrust of the financial services industry overall, “consumers trust their primary financial provider,” according to a 2020 McKinsey report.
A 2022 Vanguard study echoed this, reporting that, compared to robo-advisors and other digital investing products, “human advisors increase investors’ peace of mind by 56 percentage points.”
In other words, for firms that want to expand, and advisors that want to grow their careers, people matter; relationships matter — perhaps more so than ever before.
In a time of perceived economic uncertainty, there is nothing more valuable than the reassurance of working with someone who can take the time to understand a client’s needs and deliver excellent upfront service.
This is an important consideration when hiring for both the back and front office. Highly capable operational staff, empowered with tools that make their jobs easier, will free up advisors to offer the high-touch service clients desire.