Does Your Wealth Management Firm Need a Mentorship Program?

Newly hired financial advisors face a steep learning curve. They need to quickly connect with prospects while also providing financial services and building strong relationships with each new client. In a fast-paced and complex industry like wealth management, there’s no substitute for experience.

Fortunately, there’s a solution that can significantly reduce learning time and get new advisors quickly up to speed. Instead of letting team members figure out best practices for themselves, connect them with an experienced mentor advisors through a formal mentorship program. Mentorship can fast track new advisors on their path to becoming valuable and successful employees.

Benefits of a Mentorship Program

It’s common for experienced advisors to offer tips and advice to new ones, but a mentorship program is much more than that. Although the foundation of a mentorship is relationships, the program provides structure for those relationships. It gives new advisors someone to go to with questions and a clear path to professional success.

Normally, new advisors need time before they’re fully up to speed on processes and practices for your firm. But giving them a mentor can speed up the onboarding process, helping them feel comfortable more quickly. New advisors are much more productive with a mentor to guide them as they set strategic goals, and they’re more engaged when they feel they have support.

Mentorship programs also increase employee retention. New advisors who feel supported with the right knowledge and resources are more likely to stay with your firm. The increase in retention is especially noticeable among job-hopping millennials. One study found that millennials who say they plan to stay with their employer for at least five years are more than twice as likely to have a mentor as workers who are constantly eyeing other opportunities.

Plus, the benefits of mentorship programs aren’t one-sided. They help experienced advisors by giving them an opportunity to share their knowledge and demonstrate their skill. Top performers who participate in a formal mentorship program feel more fulfilled with their work. They get to enjoy the satisfaction that comes from helping others succeed.

How to Get Started With a Mentorship Program

Ideally, your mentorship program will quickly become a core component of your employee onboarding process. Just as new advisors are automatically assigned an office key and a desk, they’re automatically assigned a mentor. But for the first few rounds, consider your program an experimental learning opportunity. Plan carefully to build a mentorship program that will become foundational to your training process.

Step 1: Design Your Program Structure

Will your mentorship program be one-on-one, where a mentor meets with a single mentee? Or will you design a group program, in which a single mentor trains several new employees? How long will the mentorship last? What key performance indicators will measure the program’s success? You’ll need to consider these questions as you design the structure of a new mentorship program for your wealth management firm. Consider surveying your most recent new hires to discover where they struggled most during their training period, and design your mentorship program to solve those problems.

Step 2: Recruit Mentors

Once you’ve decided on the structure and timeframe, you’re ready to recruit mentors. One option is for the leadership team to choose and invite mentors they pick from the best-performing financial advisors in your firm. But an invitation-only program runs the risk of recruiting mentors who aren’t really enthusiastic about sharing their knowledge with new advisors. Another option is to invite any advisor with a minimum experience level to apply as a mentor. In either case, you’ll need to educate potential mentors about what’s involved and why they should participate.

Step 3: Match Mentorship Pairs

Next, match mentors with your new mentees. You can do this by random selection, or you can match by interests, personalities, goals, or departments. Just keep in mind that these relationships may not always be automatically smooth, and have a plan for how you’ll handle any conflict – including what you’ll do if a mentor and mentee want to part ways.

Step 4: Start the Formal Program

At the beginning of the program, provide time for mentors and mentees to get to know each other personally as well as professionally. Then, help them identify the milestones the mentee needs to achieve in order to progress toward their goals. Finally, design a plan for the mentee to take action steps while the mentor answers questions and holds them accountable. 

Step 5: Measure Success 

To determine the success of the program, use the key performance indicators you identified in the planning stage. Ideally these indicators will address both the individual employee’s objectives and the company goals. The best mentorship program will help new advisors be more successful by meeting their goals more quickly. But it will also help the company by improving overall achievement in relevant KPIs. For example, one goal could be for a new advisor to be successfully managing a full load of clients after three months on the job. Comparing the average number of new clients for mentees to the average number for new hires who don’t have a mentor will show you what impact the program has on this goal.  

Creating and executing a mentorship program is a lot of work for a wealth management firm. But hiring and training new advisors is also a lot of work and expense. If a mentorship program can help new advisors get more clients and reach a higher revenue per advisor sooner, then it could actually make your firm more than it costs.