The financial advisory business faces a classic good news/bad news situation - one that presents both opportunities and challenges. On the good news side, the number of investors using a financial advisor is expected to increase 27 percent by 2022. Counter‐balancing that outlook is a looming shortage of experienced financial advisory professionals. Market research firm Cerulli projects that approximately 25 percent of advisors plan to retire or leave the industry within the next 10 years, and for every eight advisors who retire, only three are trained to replace them.
The industry appears to have been slow in developing strategies to address this challenge. For example, recruitment efforts targeting Millennials (born between 1980 and 1992) are bumping up against significant roadblocks. Two challenges are a widespread lack of awareness of the financial advisor profession and a misunderstanding about how it might align with this group’s core values (work-life balance, opportunity for growth, and an interest in helping other people).