Lee Munson takes a page out of the drill sergeant's playbook when new interns show up, brimming with dreams of eventually running their own registered investment advisory firms.
“You get the starry-eyed kid with the CFP designation, and they come in wanting to help people, but they don't have sales training in RIA shops. They're not cold calling, and they're not pounding the pavement,” Mr. Munson said.
“You have to create some level of a hard-knocks life — be a drill sergeant for a little while,” he said.
It wasn't all that long ago that Mr. Munson, now 36 and chief investment officer at Portfolio LLC, was himself a young stockbroker — and a hotshot at that. These days, he and many of his peers are contending with a wave of newly minted college graduates with in-depth financial planning training who are in a hurry to climb to his level.
COLLEGE KNOW-HOW
The days of grooming a college graduate into an adviser over a five to 10 year-period, beginning with entry-level work at an insurance company or at a brokerage firm, are over. Recruits have been showing up at firms with graduate degrees and, in some cases, extensive coursework toward becoming a certified financial planner or a chartered financial analyst.
Financial advisers these days are finding that prospective hires often already have a definite idea of what they want out of their careers, and they are determined to get there as quickly as possible.
The advisers' reaction? Slow down.
LIMITED EXPERIENCE
Although new recruits are emerging from college with a wealth of technical knowledge of financial planning, few are prepared to sign up clients, let alone work with them.
“I find that people with financial planning degrees are limited,” Mr. Munson said. “You go through so quickly to get your degrees and get your business card filled up, but you don't know what this industry is about.”
Richard S. Kahler, president of Kahler Financial Group Inc., encountered a 23-year-old prospect who not only had a master's degree but focused on financial planning while in school. When Mr. Kahler was introduced to the new prospect through a recruiting service, he seemed like a good fit for the firm.
“He was a little me,” Mr. Kahler said. “We got along well, but he had his sights on ownership and wanted to do it soon, like in two to five years.”
Mr. Kahler envisioned a 10-year path that could lead to a succession. He ended up sending the new recruit to a colleague at another firm that was still in its growth phase.
At Mr. Munson's firm, interns begin with clerical work and fetching coffee. As they show promise, they may work on coding and statistical programs.
That was the way he brought on Bryan Giron, who started as a college intern and began working full time after graduation two years ago. He now manages Portfolio's trading platform and has a $5 million book of clients.
FEEDING THE "HUNGRY'
“I put a lot of time and effort into someone who was hungry,” Mr. Munson said. “You have to be patient and wait for it.”
Personality quirks also need to be considered.
Jorge Padilla, an adviser with The Lubitz Financial Group and director of NexGen for the Financial Planning Association's Miami-Dade chapter, said that his firm looks at 10 areas to get a handle on a prospective hire's personality.
“If you're recruiting for something that's heavy on analytical work, you might not want someone who's really extroverted,” he said. “People can adapt to a position, but you might want to play to their strengths.”
Recent college graduates know that they are joining the job market in a tough economy and have adjusted their salary expectations. However, they are looking for up-ward mobility.
“Coming out of school, they have reasonable expectations: They know it's not the best economy, so they may not be looking for a high salary,” Mr. Padilla said. “What they do expect is having the opportunity to grow and learn.”
The opportunity for professional growth is a huge motivation for young recruits to look beyond a small starting salary, Mr. Padilla said.
Mr. Munson started Mr. Giron on a $24,000 annual salary and rewarded him with raises as he improved his expertise. Eventually, the two got to a point where Mr. Munson told Mr. Giron that if he wanted more money, he would have to bring in assets, a challenge that Mr. Giron readily took on.
As far as the demands for a work-life balance, advisers said that young recruits expect to take their work home with them, but want to have some freedom to set their own schedules.
“Many of them expect a work-life balance and the ability to be flexible at work,” Mr. Padilla said. “It's not just the hours but the location.”
dmercado@investmentnews.com
