The aging of the plan advisor community is a long-standing challenge that’s getting worse every year. Just as for wealth management advisors, there comes a point at which plan advisors need to either “grow or go.”
aRIA, a group that consists of six RIAs with a combined $20 billion AUM and a consulting firm, lays out the issues for aging RIAs that have trouble attracting new talent in a recent whitepaper, “Elevating the Next Generation of Your Business.” The issues apply to any firm that’s seeking to grow but isn’t able to reach that magic number of $1 billion AUM.
Why do most RIAs fail to grow or attract new talent? According to the report:
- They don’t provide a clear career path.
- The road to ownership isn’t clear.
- Clients get worried that the business is unsustainable.
- Innovation is nonexistent due to lack of talent.
- The owner has no exit plan.
But the old adage, “Don’t fix it if it ain’t broken” can inhibit change until clients start bolting. aRIA suggests three growth strategies:
- Adopt scalable technology.
- Use human capital as the differentiator.
- Leverage bigger platforms.
The 18-page downloadable paper features a wealth of additional detail.
