Much of our time in hiring engagements with financial planning firms involves discussing team structure, role development, and overall hiring strategy. In particular, we spend a lot of time discussing with business owners about when they should hire, and for what role at various points in their business.  

Obviously, every firm is different and there are some variances, but many successful firms have followed this path. Nonetheless, below is a chart to help ensure you are considering the right hires at the correct time. 

If you are a sole practitioner, the revenue levels will be based only on your production levels. However, if you are a larger firm and have expanded into teams, such as the Diamond Team structure that Angie Herbers with Herbers Consulting recommends, you should base it off of the revenue with each team inside the organization. 

1st hire

Most firms opt for the general office and admin help at this level and usually start with a part time hire. A part time, virtual, person provides flexibility, but also could be more challenging for a lesser experienced manager.  Consider a full time person as you approach the upper end of this revenue band. 

Some firms see this as an opportunity to bring on a new planner, usually right out of school, have them complete all of the general office and support tasks while they learn the basic financial planning tasks to prep them for taking on clients later on. 

For example, if you have $50k budgeted to invest for your next hire, and you can hire a general admin, but you might also be able to secure someone out of a CFP program who has more than the basics, and eventually could become a client facing planner, alleviating another workflow bottleneck you will have in the near future if you continue to grow. 

The benefit of going this route is if you want to step away, which every entrepreneur should do for a few hours, a few days, or even a few weeks, someone with a financial planning education is in a much better position to discuss Roth vs Traditional, Emerging markets vs International, mortgages, insurance, etc., if/when a client asks while you are away. The flipside of this, and unfortunately a challenge with some of the newly minted CFP program graduates, is finding the right candidate who sees these more administrative job functions as the cornerstone to learning the business, and not busy work that they are above doing. 

Stay tuned for next month’s article on the details on the timing for your second and third hires. 

Contact us if you would like to ensure everyone on your team is the right fit for your team, in the correct role based on their personality and preferred work styles, and aligned with your mission and vision.