Stereotyping and why it matters this time


Joni of Commonwealth wrote that we should all drop the ageist stereotypes. I respectfully disagree with her advice to “drop and chill”. But before I go into my reasons and solutions to this problem, I have to admit that I had to look up the word “ageist”. It turns out that reading 140 character sound bites for the past 3 years kills your 10-cent word vocabulary. So thanks to Joni for reminding me to keep practicing big-word reading 🙂

So onto why I disagree with “chill and drop”. I have consulted to hundreds and provided free guidance to thousands of advisory firms over my 15+ years consulting and …..the stereotypes are accurate. While they don’t apply to ALL owners and millennials, they exist in enough mass quantity to acknowledge they exist. And while we hate stereotyping, it quickly shows us the flaws in our industry. I rather NOT chill and instead take this issue seriously. I prefer to dissect the flaws, learn, and help our wonderful, independent advisors to THRIVE, not die.

So here is how we learn – we revisit the stereotypes, we ask why they have occurred, and we come up with solutions so our industry continues to attract younger advisors.

STEREOTYPE 1: Aging advisors are milking the income and not investing enough back into the business infrastructure, culture, and people.

STEREOTYPE 2: Millennials want raises and bonuses sooner than owners believe is warranted.

We should be asking WHY these stereotypes are true.

WHY 1: Owners are burnt out. They never learned how to build a scalable service business. They never learned how to effectively manage people as their mentors were salespeople, not people managers. They didn’t grow up on tech that eliminated work so they don’t understand the importance of it. And overall, they suffer from cobbler’s shoes effect. They never updated their own financial plan. Now that health and burnout are creeping into their lives, they update their plan and are shocked at how much they need to save to sustain their lifestyle. Hence, they milk the income of the business.

WHY 2: Millennials wants raises to offset their unhappiness. They are not happy working in an environment that isn’t evolving, improving, nor focused mostly on the client experience. They signed up to work with clients and instead, are paper shuffling, entering data, reconciling information across systems, and more.

So now that we identified the why’s, what do we do about this?

SOLUTION: Advisory firm owners need to hire their own planner to do their personal financial plan. I realize that the owner could do his/her own planning. However, the most important part of the plan is the mental tug of war between greed and fear and wants versus needs. The objective planner will help the owner and family through the tug of war gracefully. The result – an honest, accurate financial plan and clear goals.

SOLUTION: The advisory firm needs to hire an accountant to help them create a multi-year projection of business growth, profit and expenses. Again, the owner could open Excel and write out projections. However, the owner will insert biases and assumptions that need to be reviewed and questioned. It is much quicker and better to hire an outside, objective person to do this work.

SOLUTION: Millennials need to get their game on and start practicing the art of presenting benefits. An idea or recommendation will fall flat if you don’t explain the benefits such as more time, more client growth, more profits.

I hope Joni understands why I don’t want to “chill and drop”. Maybe I am glutton for punishment as I try and improve the industry one firm at a time (and getting super gray hair doing it!).





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Good luck. And as always, health and sanity to you!

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