ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

What an Elite Group of Younger Advisors Has to Say

July 1, 2014

by Bob Veres

Bob Veres

I recently served as a facilitator for the annual NexGen conference, this year held on the campus of Augustana University in Moline, IL. This gave me a terrific opportunity to reacquaint myself with the luxurious living conditions of a campus dormitory. More importantly, I was able to gain insight into the very different way that the financial planning landscape looks through the eyes of younger advisors just starting their careers — and in many cases, from the bottom end of a planning firm's organizational chart.

NexGen is a community of professional advisors under the age of 36. It was founded independently, but in recent years NexGen has become affiliated with the Financial Planning Association, which now has operating control over its discussion forum. The first thing you notice at NexGen is that the FPA has quietly — and, of course, strategically — introduced certain rituals that somehow became part of its annual Retreat some years after the Retreat moved off-campus into luxury hotels: most notably a group "circle gathering" at the start and end of the meeting and group discussions that feature a "talking stick." (Holding hands is also involved.)

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In between, the "sessions" could best be described as facilitated group discussions rather than the usual lecture format that you see in many of the other conferences. During the first afternoon, the attendees vote on what topics will be on their agenda, and their choices this year included how to form a productive study group, big mistakes that they've made in their young careers and the future of NexGen itself. The discussions that I facilitated tended to be more general: how to create a better working environment and enjoy a balanced worklife, the professional business models of the future and applied technology, where the attendees shared their favorite personal productivity apps and business software programs and some of the productivity books they're currently reading. (This list can be found at the end of this article. For now, I'll say that I, personally, had not even heard of most of the apps, books and software that NexGen advisors are favoring today.)

The attending advisors could be divided into two basic groups: staff advisors who work primarily as paraplanners or junior planners at existing firms, and younger advisors who are pioneering nontraditional revenue and service models as founders of their own startup practices. The two groups seemed to have very different interests. The staff advisors focused on how to take on larger roles in their firms and broaden their skill sets to become more well-rounded and capable succession options. The young planning entrepreneurs, who attended in significant numbers for the first time this year (roughly 15 out of the 52 attendees), were there to compare notes on how to create a business and service model that can profitably serve Generation X and Y clients who haven't accumulated enough assets to fit neatly under the assets under management (AUM) business model.

Culture and Work/Life Balance

A discussion about creating your ideal work environment thus bifurcated into two very different discussions. Staffers talked about how to integrate their personal travel and entertainment agenda ("balance your passions" was a preferred term) within the boundaries of an established firm. The chief issue was finding ways to effectively communicate the desire for a balanced life to the prototypical Baby Boomer founder. Those founders might have worked 55-hour weeks during their own formative years and measure the value of staff productivity by how much face-time they put in at the office.

Most of the attending advisors (including those now running their own firms) either had worked in this environment or were working in one now. The wide discrepancy between working hours and desired schedule did not always seem to be the fault of the founder or owner. Some staff planners admitted that, when hired, they had simply conformed to a lot of implied expectations in the office without communicating clearly the working conditions they felt would work best for them. Rather than suffer under difficult conditions, some NexGenners said, why not set appropriate boundaries and expectations with the employer the same way the firm does with its clients?

 From there, much of the conversation revolved around how to communicate the desire for a balanced life in a way that would resonate with the founder or owner. Solution one was to simply address the topic directly and ask for the work hours you want. If that failed, solution two was to make a business case for why you can add your full value during normal work hours, without punching the time clock on Saturdays.

If that failed, solution three was to get a year or two of experience and look for employment elsewhere — with confidence that you won't be waiting long for that next job offer in a market that is visibly starving for experienced talent.

This led to a conversation about the many different office cultures in the planning profession, which is clearly a much-discussed topic among younger advisors. Founders and owners should recognize that their younger staffers compare notes with each other on great (and, sometimes, lousy) places to work when they get together informally or at local chapter meetings. Attracting talent may be as simple as giving your younger employees the chance to tell positive stories about a collaborative culture where the software tools are updated regularly, younger advisors are given client-facing opportunities and work/life boundaries are respected.

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