Paraplanners are in a unique position to gain valuable insights into how a wide range of financial planners run their firms. This round table features several paraplanners and operation consultants:

These four individuals each bring their unique background and experiences within a wide range of firms to the table. Some of them work exclusively with solo shops, and others work with large practices that have multiple advisors, but all are focused on financial planning.

In this discussion, these four entrepreneurs are going over what they’ve seen work in a financial planning practice, and what’s been challenging for the planners they’ve worked with. We’re covering everything from the importance of niches in financial planning, to what types of deliverables are most successful from a client perspective, to how life planning is impacting the lives of clients (and planners!).

If you’ve ever wondered about how you can grow your business, or whether you’re making the “right” moves in your practice, this episode is a great listen. This round table is valuable for both firm owners, aspiring firm owners, and paraplanners who want to learn more about financial planning processes and more.

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What You’ll Learn:

  • The importance of working with clients you’re passionate about
  • How financial life planning positively impacts clients and advisors
  • What types of processes work best in a practice
  • How to leverage outsourcing to balance your practice’s growth
  • Ways to add additional client touch points that are actually meaningful
  • How technology can be used to grow your practice
  • How paraplanners can interact with planners to grow their own businesses and help their clients grow theirs
  • How to build trust with a virtual team
  • What types of qualifications advisors should look for in a paraplanner
  • Different ways that mindset impacts financial planners and their practices

Show Transcript

Episode Transcript


Hannah: Well, thank you everyone for joining us today. I am so excited about this conversation because it’s fascinating to see this rise of paraplanners and how it’s impacting financial planning and how planning firms are doing it. We’re going to be talking a lot more about that on the podcast in the next several weeks. But what I’m really curious about is what insights do paraplanners have that can help us really learn about financial planning, because you guys really have a front row seat to multiple different financial planning firms. I think that’s fascinating.

Hannah: The first question that I want to throw out to you guys is, what have you learned about financial planning since being a paraplanner?

Matt: Well, Hannah, I’ve learned that just because someone labels themselves a financial planner doesn’t mean that they do the same thing as other financial planners. I currently work for three CFPs and I know we’ve talked a lot about the CFP on the podcast here before. But they all do things very differently. It’s not to say that one does anything better than the others. But just the styles and what they’re actually delivering to their clients is very different.

Jim: Yeah. Kind of bouncing off Matt there. I’ve worked with 16 firms over the past two years, and some of them have been in the broker-dealer world, but most of them are fee-only advisors. But when people talk about niching, that really does make all the difference because if you work or I’ve worked with firms that only focus in the medical world, and trying to work with other firms that don’t focus on the medical world but they have doctor clients, it’s a night and day difference.

Charesse: Yeah. I agree with Jimmy and Matt. My biggest takeaway, working virtually and working with multiple firms, is that, yes, everyone is different and it’s okay. I know a lot of advisors talk about the fee-only, the fee-based, AUM models. Those are all serving different types of people in the world, so I think it’s great that there is a variety of service offerings to serve their client base.

Maui: Yeah. I’ve seen that with the different firms I work with. Actually only one of them has a CFP on staff. The others, they have various backgrounds like CFAs or CPAs. But in general, financial planning is both a science and an art. You see that kind of magical combination in all these different firms. They all approach it a little bit differently. But financial planning is also really dynamic. It changes over time and in general, I think, all these advisors, they want to do their best job in serving their clients. Really, our job is just to connect the dots for clients. But everyone approaches that a little bit differently and does it in their own way.

Hannah: Oh my gosh. There’s so much good stuff in here. Okay. Matt, one of the things that you mentioned in your answer was that not everybody does financial planning. So I’m curious. From your guys’ perspective, how do you guys define financial planning? How do you know when a planner’s actually doing financial planning versus just doing investments?

Jim: I started off my career in Edward Jones, part of the broker-dealer side of the world. They really taught us to sell a lot before we ended up actually doing financial planning. So some of the firms I work with, like I said, most of them are fee-only, but I do do some broker-dealer world stuff. Some of the broker-dealers guys are awesome planners. They’re phenomenal. But then other ones, they really try to collect the assets and start getting those fees for a few years before you really start putting together a comprehensive plan.

Jim: It’s kind of odd. From the outside world, if you’re a client, I don’t even know if you could really tell too much of a difference. That’s why I think fee-only’s so great, because there’s no conflicts of interest up front. But even in the fee-only world, I mean, if a firm’s really being funded by AUM, they’re really going to be focused on getting the AUM before they put time and invest their time into actually putting together a plan, if that makes sense.

Matt: Yeah. That makes a ton of sense, Jim. I came from the broker-dealer world as well. I know there’s a separate podcast with me ranting about that. But when I think about financial planning, it’s really more of having a conversation with the client and really developing that relationship versus just getting an email from a client, commonly about investments, and just answering a question. That’s really where I define the difference. Are we just trying to fit one need of a client, or are we really trying to take that need and have a conversation around it? That’s really where I see financial planning. That is what financial planning is, is having that conversation.

Jim: I also think a lot of planning … I kind of said about niches before too. But when advisors niche down, they can add so much value to a client’s life that the clients don’t even know that what’s going on. Okay. For example, let’s use tech companies. ISOs and AMT taxes are so complicated that unless that’s your specialty, most advisors can’t even really help you plan it. They can tell you, “Hey, go to the CPA,” or, “We’ll try to help you when to exercise your stock options,” but unless you’re actually specialized in it, it can be really, really messy.

Jim: I find a lot of planning value in advisors who are in niches, so to speak.

Maui: That’s a great point, Jim, because I think with financial planning, one of the best things we can do for clients is to know when we don’t know and when to refer out or to tell them that we’re going to do more research. I think that’s something that I’ve personally learned in the past year is the more I grow as a financial planner, the more I do paraplanning I realize, wow, there’s so much out there besides just what we learned in textbooks, just being willing to admit that sometimes and do the research before going back and then referring to experts.

Maui: I remember last year just mining through variable annuity contracts. I was like, I have no idea what I’m doing. So I went on XYPN forum and some other forums and realized a lot of people actually refer that kind of thing out. So that was a good learning experience for me. I don’t think we need to be a jack of all trades and be experts in every area, but it is helpful to have some core areas of expertise that we can really offer our clients.

Jim: It’s really a pride thing too. I’ve seen advisors, they work hard to get these clients, but but sometimes you have to swallow your pride and just admit that there might be a better fit with someone else versus just trying to take on the whole animal by yourself.

Charesse: Yes. That’s where I think the advisors that do not offer AUM come into play. Sometimes their client base just doesn’t need that type of service model. So I definitely agree with you, Maui and Jimmy, that sometimes it’s just good to niche and refer out. So I do see advisors who only do the financial planning process, but then they outsource the investment management part, which is good because then they can focus on the implementation of the plan for their clients and have that conversation to check in every few months and make sure they have their estate planning documents in place and they have their insurance documents that they need. So I think it’s really good to niche in certain situations.

Matt: Yeah, and I think too, at least what I’ve seen with the planners I work with, when they do get into that niche and they find what type of work they truly enjoy doing with their clients, they tend to be more happy working with those clients. Across the board, all the firms I’ve worked in, they’ve all had a couple of those clients that they just, they really are not looking forward to the next email or the next phone call or the next meeting. Those are generally the clients that they’re not doing the work or the area of financial planning that they’re truly passionate about.

Matt: So I think just from a job satisfaction standpoint as well, niching is really important.

Hannah: Well, let me ask you guys. How have you seen the delivery of financial planning differ between firms? I know we’ve talked a little bit about the niching versus non-niching, but I’m thinking meetings and deliverables and from a client perspective, what have you guys seen between firms?

Charesse: For me, I would say the biggest thing I’ve seen coming up is life planning. It’s very different to the standard model where you meet with clients quarterly. They’re doing more exercises with their clients to get a better understanding of their goals, their thought process with money. And then also I see modular planning, which I feel like … I’ve been doing virtual paraplanning and operations consulting for roughly three years. Within that timeframe I’ve worked with roughly 35 firms. For a while last year, most of the people were doing modular planning. For a while, I’ve seen a switch in life planning.

Charesse: So I think with those models, it’s very different. With the life planning process, there’s not a lot of meeting prep involved for probably the first three to four meetings, and then after that, they will illustrate the financial plan. With modular planning, they’re breaking all of the financial planning topics out per meeting. So typically within the first year, most firms are meeting with their clients between six to nine times. And then after that, it drops off to four times a year, just because the first year there’s more implementation up front.

Jim: Yeah. I totally agree with Charesse. I actually almost forgot about the whole life planning side because as a paraplanner, I live my days in eMoney and creating eMoney deliverables and writing up board documents and everything like that. But from a client standpoint, they don’t get these plans until, I don’t know, two months into the process. Who is it, Kinder, the Kinder Institute? Is that who does all the life planning stuff?

Charesse: Yeah. George Kinder.

Jim: Yeah. His questions and everything, pretty much all the firms I work with start a financial planning relationship with those questions. I think it adds a lot deeper insight into the clients and everything. But from a paraplanning standpoint, you don’t really pick that up until you work with a firm for a while since a lot of my stuff’s just done in eMoney.

Hannah: I’m really interested in this idea, because you guys are really on the back end side of this. Does the life planning help influence what you do?

Jim: That’s a great question. From a high level, I would probably say no, because the paraplanner side’s very black and white. It’s really just going through the CFP process, the six steps, trying to figure out where people are at, where they want to go, and how should we get there logistically. Like Maui said, it’s a science and an art. The advisor’s side, a lot of what they’re doing is the art of it. It’s holding the client’s hand. It’s helping them understand what they need to get done. But the paraplanner side, I feel, is much more the science. It’s much more of logistically being organized and putting together a list of processes and action items that need done for the client. But then the advisor will present it in an artistic, non-boring way.

Charesse: I’ll also chime in on that. I was an associate planner, full-time at a firm, and then I broke off and did virtual paraplanning. I feel like it’s kind of different when you are serving for one advisor versus five advisors at a time. With life planning, when you look at the answers that these clients are providing like, why are you here? What are your goals? It helps you get to know the client more. So if we’re talking to someone that’s a paraplanner at one firm and that’s their full-time commitment, then that’ll help them service that client better and learn how to manage the relationship, so with that career path, whatever they want to do that may help.

Charesse: But for us, our main job as virtual paraplanners is to prepare the plan the most efficient and effective way. So I think life planning could play a part for both to a certain extent.

Maui: I would say that the firms that take the time to do more of that life planning up front, because as a paraplanner who’s virtual and lives sometimes hundreds of miles away or thousands of miles away, I don’t ever get to meet the actual clients. Oftentimes, I’m not in the meetings when they’re having these conversations. So when they do the exercises and the clients actually fill them out, it’s really cool to see it on the back end. Because it’s not just the hard data that I’m seeing and entering into software, I kind of get a glimpse into the client’s mind and their values and their life and depending on how in-depth the exercise goes.

Maui: I think as paraplanners we just have to make the most of the data that we do have. So when advisors do more of that life planning side, we get more data and more qualitative data. I think it actually helps us do a better job in putting together the plan for that client.

Matt: Yeah. I definitely would back up what Maui said. I think it really just gives us context into who we’re working with and sometimes that’s really, really difficult for planners to communicate, especially at first when you start working with them as a paraplanner. But it helps us understand while we’re going through the plan, what questions should we be asking the advisor when we’re modeling out different scenarios or creating different deliverables depending on how customized the advisor’s process is. It really just helps us kind of be that safety check and make sure that we’re doing things correctly.

Charesse: And also I would say just we all work from home, I’m sure. But it just makes our job more meaningful. We see numbers all day, so if we get to see the actual person behind it, it puts a big effect on what we do. When I first started virtual paraplanning, I did attend client meetings virtually. It really helped me feel more in a team instead of working solo.

Hannah: Jim, one of the things that you had talked about too, is you guys are running these eMoney reports or running iPRO or whatever software that’s being used. Are you guys seeing a variance in how firms are using that software?

Jim: Yeah. I really think it’s the story that you’re trying to tell. Financial planning software is really, for the most part from my experience, it’s just looking at retirement. eMoney has so much functionality, but no one uses 90% of it. It’s literally, okay, are these people on the right track to retirement? If they’re younger, are they spending too much or saving enough money, or whatever the scenario is? But at the end of the day, it really comes down to the story that the advisor’s trying to tell.

Jim: For example, if an advisor’s trying to … If they’re on the broker-dealer side and they’re trying to collect assets or sell a long-term care policy or something like that, you’re going to use a software to try to tell that story. But on the other hand, if people are spending way too much and they really have to live below their means, you can use the software to try to help tell that story of why they should save more money. There is variances in it, but it really just depends on the advisor and their practice and which way they want to lean their advice towards the client.

Matt: I agree with you, Jim, and it really does go back to the whole niche situation. Just looking at an engineer, for example. They might be more in tune with a lot of the cashflow reports that eMoney can produce or some of the investment-related aspects of that, whereas Hannah, your clients, some of them just want a one-page piece of paper that shows where all of their money is and how it’s going to be spent throughout the rest of their working career and in retirement. So it really does go down to, again, the niche and what, like Jim said, what story the advisor’s trying to tell.

Maui: Yeah. What I’ve found really interesting is that even within specific firms, the clients, some are very engaged with the software and some are just totally don’t care. So I think over time, the advisors had grown an awareness for which clients are more engaged than others and they’ll tell me that before meetings. “This client logs in a lot. He’s very much up-to-date on what’s happening, so maybe dig in a little bit deeper with his plan in the software.” And then some others, they just … You give them the login and you look a year down the road, they never touched it.

Maui: It’s just really interesting how different clients treat the software a little bit differently. That does inform how deeply I go into creating the plan as well because sometimes you can create these really beautiful plans with all these great assumptions and then the client just takes one look and they’re like, “Oh, okay. I trust you.” And then they’re good.

Charesse: Yeah. I would also say with the technology, it can do different things. For example, a lot of the people I work with use eMoney. So I do ask firm before I start working with them, “What’s your client base look like? Are they more hands-on with the technology or are they not?” I think a lot of firms are more concerned about documenting observations and next steps and doing that executive summary. For example, if you have a client that’s not hands-on, you can add all of that information into eMoney and then download the report and give it to them in the meeting.

Charesse: If you have a client that’s more interactive and that wants to be in the system and have a more collaborative approach, then they can go into eMoney or RateCapital and complete their task. There’s other softwares that can do that too. I feel like now the fintech is diversifying their offerings and making it easy for any advisor to plug into their system and do what they need to do to service their clients.

Hannah: With your inside look at financial planning firms, what have you learned about financial planning firms, both good and bad, that you wish that others knew, that you can really share with us?

Matt: I’ll start here. I think Charesse might be able to run with this a little bit. But as I’ve onboarded with planners, I’ve just learned that there’s so many different ways that planners run their firms, both on the business side and both within the financial planning side of the firm. A lot of times, financial planners don’t have their processes thought-out entirely and that can make it really difficult to bring a new person into your firm, which can create problems when you’re trying to grow the firm.

Matt: I think too that sometimes people try to hire part-time help or an intern or a junior planner without truly thinking what tasks they want to get rid of and what that looks like for the person they’re going to be bringing into the firm. That can create a lot of headaches. In looking back at one of my previous jobs here in Madison, that was definitely the case. That’s by no fault of the planner. He didn’t know what he wanted that role to look like. So that’s something I wish I knew going into it and having a better thought-out process of onboarding those first few planners I worked with.

Charesse: Yeah. I agree with you, Matt. I think one of the biggest things why advisor hire me since I do paraplanning and operations consulting is that they want to make sure they’re doing things right. I just feel like a lot of advisors don’t realize that it’s okay to be different as long as you’re checking the boxes as you go through that process. And then also with the hiring, I definitely agree with that. That’s why I think it’s good to be mindful of what your day looks like. I work solo, so it’s really hard for me to write down everything I’m doing. But when you do that, you’re able to identify what’s low priority and what’s high priority.

Charesse: I recommend a lot of advisors to strive to be 100% client-facing, but as a small business owner, that might not be the case. So when I help firms build out their processes I’ll say, “This is what we’re going to work on right now. This is what your workload looks like today.” Let’s say you’re not 100% client-facing, but by the end of the year, you will be. So you can, every quarter, look at your list of tasks to delegate out to your virtual paraplanner or administrative assistant, whatever it may be, and then that’ll help you feel more comfortable instead of offloading all your workload at one time. You’re going to overwhelm the person. You’re going to start micromanaging because you’re nervous about it. I think it’s really good to have a timeline in place when you’re hiring people.

Maui: The encouraging thing that I’ve seen with working with … I mean I definitely haven’t worked with as many firms as some of the other paraplanners on here. But just the few that I’ve worked with, I’ve been encouraged to see that advisors really, truly care about their clients whether they are active managers or not, whether they focus on life planning or not. They do really want to do what’s best for their clients. With that being said, I think most of them are kind of just figuring it out as they go. Like Charesse said, that’s okay. I think all of us, are to some extent, figuring it out as we go.

Maui: It’s interesting to see some firms. I think processes is a big one where most firms don’t feel like they are super solid on their processes. Deliverables is another area where it’s always kind of evolving. What do you think we could do here? Could we improve this? Even sometimes investment policies, they’re still evolving. I think for me personally it’s just by the luck of the draw I’ve been with newer firms or firms that are newly incorporating financial planning into their practices. So they’re not necessarily as established. I just kind of get to see the front end of this evolution, maybe more than some of the other firms.

Maui: But it is a very interesting and dynamic process. But I know that at the end of the day, it’s motivated by the fact that these advisors really care about their clients.

Jim: I’ll second that one. Pretty much everyone I’ve worked with has been … They’ve all been very, very good people. Their heart is always in the right place. Now, with that being said also, something I’ve noticed too is sometimes you’ll see these advisors out there and they’re speaking on panels and they’re doing great and they look like they’re being real successful and everything. But behind closed doors, they’re actually kind of a mess. Going off Matt’s point, their operations isn’t necessarily organized or they need to work on their processes and everything. But their heart’s in the right place.

Jim: We’re all entrepreneurs here in this game, so it’s just where you’re at in your journey. It just happens that some advisors put on a bigger show, but they don’t have the organization skills to back it up. But then there’s other advisors that don’t look like they’re doing very, very well and they don’t have a lot of clients and they’re bringing in the bank. They’re doing great and they’re super busy all the time. It’s just interesting.

Charesse: Yeah. I definitely agree with you, Jimmy. We’re looking under the hood of all the firms. It’s interesting to see. You have advisors who just keep their head down and do their work and grow their practice. And then you have the other side, a lot of thought leaders who want to spend more time being advocates in the industry for whatever purpose it may be. But I also think we all have to think about being an advisor or a paraplanner, whatever business we have, and then also growing that skillset. So for me personally, I’m really great at what I do, but I had to be mindful of growing my business as well.

Charesse: A lot of these firm owners are focused on marketing, business development, being a manager, and also being a great advisor. It’s really hard to balance, and that’s when outsourcing comes into play, outsourcing things that you may not be good at. It’s okay to do. You have to do that to grow. You can’t run your practice by yourself because when people hire me they’re like, “I only have 10 clients. I’m okay with doing it by myself.” But I’ve worked with people who’ve had 20 clients and then a year later, they’re like, “I have 75.” That’s great, but you can’t service 75 clients by yourself.

Matt: Right. I think, to Charesse’s point. The earlier the advisor can understand that you do need to let go of some of those tasks, it’s great for us, and it’s great for them too because they’ll have more time in their schedule to go do the things that they really want to be doing. So that’s just something. I’ve seen advisors who are really great at delegating, and advisors who are really not so great at delegating. I tend to enjoy working with the ones who are better at delegating. Obviously that means more hours for me, but it also means that they know what they want to be doing, and they’re going to be happy doing that work.

Hannah: Have you seen, talking on delegation and advisors, I guess it probably is by person. But you guys see the evolution of firms really. Can you talk a little bit about, is it easy for advisors to delegate? Or what makes it easier for them in that process?

Jim: I think a lot of it comes down to trust in the person that they’re delegating to. How much do they actually trust them? Pretty much most of the firms I’ve worked with it starts off I mean very, very small. We might work together two hours a week or something. But as that trust organically develops, you just naturally get more and more and more responsibilities to the point to even though I’m still outsourced, they couldn’t run their firm without me because I’m doing so many of these duties and everything.

Jim: Once advisors find that special person, whether it be an admin person, a paraplanner, consultant or whatever else they have, after they build that rapport and that trust and that person shows consistent success … Everyone makes errors. We’re all human. But as long as the person’s not being sloppy or anything, I’ve seen advisors get really relaxed with delegating, to the point where they don’t even think about it, it’s just second nature. So it’s almost like a skill. Delegation is a skill that we have to learn ourselves, but also advisors have to become comfortable with.

Charesse: I also wanted to comment on delegating to a virtual team member. I think that’s a lot different to advisors. A lot of advisors message and they’re nervous about doing it. But I recommend with the paraplanners I talk to and the advisors I talk to as well, to do a trial period or a training period. 90 days, commit to the person you’re hiring that you will help them and train. And then after that, hopefully they’re able to work more independently and it’ll make both sides feel more comfortable with delegating the task. Also finding a central location to store all pending projects, plans, whatever it may be, and having a way to communicate outside of email.

Charesse: A lot of advisors are using Slack or commenting in their CRM, which is good so you can get those real-time updates on what your team is doing if they’re outside of the office.

Jim: Oh yeah. I have to jump off that real quick. I guess this is about a year ago. XYPN came out with an article called, The Three-Month Training Plan. It was really simple, but it was basically talking about creating an Excel spreadsheet and have a task for every single week over the next three months of what you want your new hire to learn how to do. So by the time the three months is up, they know how to do a lot of stuff. It’s very organized. I don’t want to call it overly rigid. But there’s this plan to have success. If you don’t have a plan when you dedicate to hiring an employee or outsourcing to someone, it’s going to fall apart because it’s really hard to be on the same page as other people.

Jim: I think when you’re trying to delegate … If I put myself in the advisor’s shoes, if I’m trying to delegate a plan out to me, everyone has their own planning philosophies, so you have to make sure that you’re constantly communicating back and forth to build that trust. I use Slack and Asana and I’ve seen huge successes with those because you put all your notes. It’s easy to message back and forth. It’s not like you have to wait for your meeting with the advisor next week. If something comes up, you just message them right away. Or you put notes in Asana and now it’s organized.

Matt: Yeah, yeah. I agree with Jim a ton on there. Especially in that trial period like Charesse was talking about, it’s really important to be collaborative in that time just so that, again, we have to understand how the planner does things their way. That goes back to the technology conversation and the niche conversation again, where just because we work with two firms that use the same technology with financial planning clients, they can use them in radically different ways. Having that trial period is a really great chance for us as paraplanners to ask the planners questions as well as have them coach us on how they want things done so that further on down the relationship, there are less of those questions going forward.

Matt: There’s still some training time, but having someone who’s familiar with the tools really helps ease that transition.

Maui: I will say that for some of these firms, hiring a virtual paraplanner is so new to them that going back to the trust conversation, there was one planner who told me that she hesitated hiring a virtual paraplanner for a long time because she really didn’t know what, I guess, caliber of talent or qualifications she would get because virtual paraplanning is so new. I think she got to a point of it was almost a necessity to find someone to be able to outsource some work to. I want to say she was pleasantly surprised with us working together. I think that is great and kind of opening the doors for her to be more open-minded to hiring virtual talent in the future.

Maui: I’m just really glad to see that. The industry, in general, I think is becoming more open to having virtual staff, whether it’s a paraplanner or a virtual assistant. I think that there’s a variance of what kinds of services different paraplanners offer. I also want to say that cost plays into what they delegate as well. What I found is that a lot of times these firms, the reason why they hire a virtual paraplanner, someone who works part-time virtually, is because they may not be within their budget to hire someone full-time on-site yet. I’m sure they want to delegate more to me, but because of budgeting and cost, they ease into that. That plays into the type of work I get and how much of it as well.

Charesse: Also I wanted to bring up the fact that a lot of advisors lean on us for best practices in the industry. We also have to be mindful that we are business owners. When I work with an advisor, I have my own contract. I have my own system to get paid. I feel like that helps elevate me as a professional, and the advisors love it. So I communicate with them clearly. They know when they speak with me, you’re going to get a next step summary after our call. They just feel more comfortable if I have my own processes for how I manage my work.

Hannah: It’s a great question. For all of you, do you guys view yourselves as business owners? How do you classify yourself?

Jim: Yeah. I would definitely say I’m a business owner, entrepreneur. I love being part of a team with these people I work with, but at the end of the day, I am my own entity. I have my own planning philosophies and how I would run a firm if I was an advisor, so I like to bring that ownership mentality to the table. I like having a seat at the table with the people I work with. Sometimes you disagree with people and I think that’s good, because it really makes both sides question. And then other times I just really like to … If an advisor has a great idea and they’re running with this project that they want, I love going outside the paraplanning and just really helping them as a fellow business owner myself, if that makes sense. It’s like a whole different mindset shift than just being an employee.

Maui: I would agree. I think that one of the biggest advantages probably to hiring a virtual paraplanner is the fact that … Because I was an associate advisor before at a local RA, and I agree with you, Jim, it’s a totally different mindset because I view myself as a business owner and an entrepreneur. So we’re able to take ownership and really view things from that ownership lens. What’s going to impact the bottom line? What’s going to be efficient? How can we retain clients long-term? As opposed to just an employee mindset of still providing value, but not taking as much ownership or being as proactive with the business.

Maui: I think that that’s part of our value as virtual paraplanners is that as we’re building our own businesses, we can help relay some of that mentality to our job as well.

Jim: I actually think it’s a huge value-add because we’re not yes men. I don’t depend on any of the people I work with. We’re a team. When you’re an employee, if you upset your boss, now you’re really anxious because you only have this one boss and you get stressed out. But because I work with so many people, we’re not yes men and we are going to give objective advice and our objective thoughts. I think it’s a really collaborative way to look at it and to run a firm.

Hannah: When looking at what you’ve learned or what you’ve observed from working for multiple different firms, one of the things that you mentioned was it’s not just how financial planning is done, but it’s how they run their business as well. So I’m curious. I mean we have the fee model. I mean it’s obviously one, but have you seen anything beyond that of how financial planning firms are run differently from each other?

Matt: I think just from an operation standpoint, some firms like we’ve already discussed, they have very outlined processes of this is the way we do things, and our clients fit into the box of what our services are as a financial planning firm. There’s certainly other firms who they’re very malleable in what they’re offering their clients. So it’s not, okay, here’s what we’re offering you and this is what we’re going to deliver. But what do you want out of a financial planning relationship?

Matt: I would say that the more customizable firms, they’re not looking to have massive amounts of clients. They want to have a small core group of high-paying clients that are getting a highly-customized experience versus someone who’s trying to reach the mass market or really scale their practice. That certainly goes down to those who are looking to run a lifestyle practice. But even that can change over time. How many hours do you want to be spending inside of your business? Those are just some of the high-level differences that I’ve seen.

Charesse: Also to add to that, I’m seeing a lot of firms that have a white glove service where, Matt, like you said, very small book of business but you’re very service-heavy. Then you have firms who are service-heavy in a different playing field with the Millennial client base or the client base who’s more heavy on the financial planning side and they need help with pulling their credit report or figuring out their student loan debt, so things like that. And then you have the other tiered service. I’m starting to see a lot of advisors who make all their clients go through a fee-only process, and then after that they will implement the AUM model.

Charesse: And then everyone knows this, but virtual practices. A lot of people want to go digital with their team, with their clients, and be able to hire anyone from anywhere in the world and work with clients from anywhere in the world. Interestingly, it’s really hard to get firms to transition from working only in one location to the digital space.

Jim: I really think it’s a priority to the owners. I’m just going to be basically repeating what Matt and Charesse just said. But a lot of the people I work with, they’re lifestyle practices and that’s why they outsource, because they don’t want the hassle of trying to hire and train someone. They just want to outsource. They want to enjoy their lives, enjoy their clients, and enjoy their families. But then there’s a other firm I work with. They want to shoot to the moon, past the moon to the stars. They just want to keep growing and growing. So it’s really keeping the end in mind and having your why.

Jim: When these advisors are in tune with their why, that kind of dictates the direction of how they want to grow their firm.

Charesse: That’s a really good point. Outsourcing versus hiring a part-time W-2 employee or full-time W-2 employee. I’m noticing a lot of firms that are bigger, they’re still outsourcing. I think a lot of people want a mixture. I feel like marketing’s the biggest outsourced service, but when you want someone to help you service your clients, as I mentioned earlier in the podcast, it’s good for someone on your team to know your book of business. I work with firms who may have high turnover with their employees or you have someone that’s outsourced and only focuses on one aspect of your business.

Charesse: It makes it challenging for someone else to step in while you’re away. So if you have someone dedicated to you and your client and they’re client-facing or interacting with them through email or phone calls, it’s helpful for the long-term. For the lifestyle practices, it may be good to outsource long-term, but as your book grows, you’re going to need someone there who knows who your first client was and who’s new.

Hannah: That’s a really interesting question of, when should a firm hire somebody, like you said, a W-2 in the same location, make that hire versus outsourcing?

Charesse: I would say, my experience, I think it’s just when you hit capacity and you realize that you need someone to be committed to your business. I have worked with firms who outsource work and I was client-facing. But eventually, they just have a bigger need. For example, I did work with a firm I was outsourced with, but eventually she needed someone full-time and I wasn’t able to make that commitment. So it’s good setting expectations. Then I see people who just keep outsourcing. If one person hits capacity, they keep that person and they just find someone else to help with a different, specific job. I don’t know if that answered your question or not.

Maui: I think it also depends on how much management you want to do with that employee or contractor. I think that determines whether you hire an employee or a contractor or outsource someone. Again, just the firms that I’ve worked with, they’ve all been newer firms, fast-growing firms, and maybe not as much financial planning experience. So I feel like part of the reason why they decided to go the outsource route and hire someone like me is because there is some training involved at the beginning, but really they wanted someone who can come in and be somewhat of an expert in that space and really take off and make something out of that work and that position as opposed to maybe hiring an employee who they have to really train and have more hands-on management.

Maui: That was maybe something I hadn’t thought about much going into paraplanning, but quickly grew into that role and it matches my personality great because I’m entrepreneurially-minded as well. But I think that level of management or lack of management determines whether someone outsources or hires in-house.

Charesse: Definitely I’ve worked at firms full-time and now I work outsource. There’s such a difference in how employees are empowered versus outsourced employees. I think if firms want to hire a W-2 employee, they need to make a commitment to make sure they’re building their skillset. So I remember when I was working full-time, I attended a TD Ameritrade conference. All the business owners were so surprised that my firm sent me there. Now I’m working with firms virtually and obviously that was the foundation of my profession.

Charesse: So I definitely think firm owners should really consider how they can develop their skillset for their team. Then, like Maui mentioned, they can have some of the skills that we have and they have their independence and they’re able to work on their own and be empowered and feel confident in the work that they’re doing.

Maui: I agree. Part of being solo is that we are now responsible for our own professional development. We pay our own way to go to conferences. We’re able to take ownership of that professional, that career. But I totally agree with you, Charesse, that for firms who really want to cultivate strong employees to really invest in the development of those employees so that they can flourish and thrive and not have to go out and be on their own, to really take ownership of their career.

Charesse: It’s going to impact the client experience as well. If the team members are working more efficiently and they feel more confident, then that can help the advisor focus on managing the client relationship in doing the business development, all the aspects we discussed of running a business, being a manager, and working in the profession to serve the clients.

Hannah: You guys have all had a whole variety of experiences as you guys have entered the financial planning profession. What would you recommend or what would be your thoughts to a new planner who’s entering and looking for their first job? I mean you guys see the inner workings of these firms. What advice would you give to them?

Jim: Michael Kitces wrote this in one of his blogs a while back of, “Every planner has to start somewhere and you always have to start at the bottom.” Even though I’m no longer in the broker-dealer world, I started at Edward Jones. That was some of the most valuable education I ever got. I did my seven, my 66, it’s really just the hard knocks of sales and how do you relate to people and how do you grow a business. You listen to all these podcasts and all these advisors talk about how they started their careers. There’s never a perfect firm out there. Every firm has their benefits and their flaws, but I think just getting started in a firm that you feel aligns with your interests because I can promise you, that’s going to change over time.

Jim: Once you get in there, you’ll see you like working with these clients instead of these other clients or you like working with these software packages, but not these other ones. You’ll grow your own identity, but you just have to start. So my advice to people is just find a reputable firm that people have respect for and then always … Don’t just drink the Kool-Aid. Always look out beyond the fence and see what other firms are doing, and you’ll get an idea of what is the right fit for you long-term.

Matt: Yeah. I absolutely agree with Jim. I guess my two words of advice would be, be curious. One of the things I love the most about working with multiple advisors is, and I know I’ve already said this before, but I get to see the same thing done three completely different ways. There’s things that I like about each firm, and there’s things I don’t like about each firm. Like Jim said, just always be learning and understand what works for you and use that to shape your future career decisions.

Matt: Within the three planners I work with, if one says, “Hey, I need more help,” and I enjoy working with them, I might drop one of my other paraplanner clients. That’s just the reality of being a business owner and ultimately doing what works for you and what’s going to make you happy going forward in your career. Even though you’re young and just starting in the industry, there’s a lot of ways to acquire knowledge. You can really make yourself a value-add to just about any firm going forward.

Charesse: I would also say make sure you have a mentor in your office or throughout the industry. Also figure out how your employer will help you grow your skillset, as I mentioned before. That is so important. I felt stagnant at my job before I started this. That’s why I left. If someone would have helped me develop my skillset, I’d probably, who knows, I probably would have been working for them. But one of the biggest things I see is that employees aren’t getting an outside look with the industry.

Charesse: We have FPA. We have XYPN. These conferences will help your team members grow, then they can come back to the firm and share that information and feel more excited about working in financial planning. The other point I will make is asking the firm what their vision is. Where do they see you in a year, two years, three years? If they see you at a different point a year from now, how are you going to get there? What does that timeline look like? Do you have one-on-one conversations with advisors? I tell advisors that they should meet with their team weekly, monthly, whatever it may be, to discuss what everyone’s working on so people can be on the same page so people know, okay, this is what this person does on the team and this is what this other person does on the team, and they’re resources to each other.

Charesse: If you have a question sent to the advisor that really should have went to the marketing person, everyone has clear expectations on what everyone’s doing.

Matt: Yeah. Just to pop in for a quick second, Charesse, because I learned this the hard way. When you do have those discussions about expectations, make sure you get them in writing just so you have something to refer back to if things are not going as your employer promised they would. That’ll just help you feel comfortable in having those conversations and asking for the help that you need to advance professionally.

Charesse: Yes. Also just another point, one big thing for me is the office culture. Knowing how I will be managed and what freedom I have for my schedule is huge for a long-term fit. If the culture just doesn’t fit with you, it’s okay to move on. I’ve definitely done that throughout my career so far, and I’m not senior level. It’s okay to pick and choose. Like we’ve all said, there’s so many different varieties of firms out there, so I don’t think people should settle just for a job.

Maui: I agree. To someone who’s just brand-new and starting out, not that I’m so much further along, but I would say do your research. I differ a little bit from some of the other folks on this podcast because I am a little bit of a career changer. My undergrad was in accounting and I did that for a few years. And then I was a stay-at-home mom for four years. When I was looking at coming onto this industry, I wanted to make sure that I’m going to do this long-term because at that point I wasn’t going to be changing careers many more times. I have three little ones.

Maui: I’ve really done my research. I met with local financial planners. They were in the broker-dealer or hybrid world. But I knew by the time I started working or looking for a job that I didn’t want to be in that part of the industry. I was very intentional about what type of firm I would end up working with. So I started off right off the bat with a fee-only fiduciary firm. To this day, I’ve only worked with fee-only firms. I would say that every time I’ve gone to interview with whether it’s an employer or with someone who’s looking for a virtual paraplanner, I think just having done my research and knowing my way around the industry even though I don’t have that much experience, has been very impressive and it’s also worked in my favor so that I can end up in a position that I would be the most happy with.

Maui: And then the second thing I would say is just to be confident. The great thing about this industry that I love is that it’s evolving. We get to be a part of the dialogue. It’s a big industry and there’s room for everyone. Again, as a mother with three young ones, my husband travels off and on. I wanted flexibility. I wanted some autonomy. I wanted to be an entrepreneur. Somehow I was able to find a place in the industry where I fit, that I can do all those things and still call myself a financial planner. So I would just say that keep looking for that ideal arrangement for your career goals and aspirations and you’ll find it. It’s a great industry where we can really make of it what we want.

Jim: I think a lot of it has to do with self-awareness too. I know everyone’s a little bit different. When I came out of college, I really had no idea what I was doing. But that’s why I think just jumping in was great, but now since I’ve been doing this for several years, having self-awareness with the type of firm you want to work with is huge. For me personally, it’s being virtual. I do a lot of traveling. I’ve lived all over the country since going virtual. To me, that gives me a lot of satisfaction if I can grow in the financial planning career, but also have the ability to travel.

Jim: But I have other friends of mine that love going to the office. They love having happy hours on Fridays and going out with their friends and everything like that. Between the culture and being self-aware of what truly makes you happy, I think that’s important.

Hannah: Do you guys see yourself as paraplanners in 10 years? Or how do you see this in the context of your overall career path?

Jim: I’ve actually gotten multiple soft offers from people I already work with now. Charesse touched on this. As these firms are growing and everything, if you’re in an outsourced position, the opportunities lend itself to you to be like, hey, if you want to come on full-time and be an associate advisor, we would love to have you. So I’ve had several of those. I mean I love doing the outsourced paraplanning now and I think I’m going to continue doing it. But long-term I’ll probably end up going to a firm that I really enjoy working with, and then become a full advisor with them.

Charesse: For me, I started off virtual paraplanning. My goal originally was to get experience as a virtual paraplanner then eventually become an advisor. Just like Jimmy, you will get job offers if you do virtual paraplanning. I’ve gotten several full-time offers, but I actually decided to shift my business towards operations consulting because I’ve seen the need for it. A lot of people were coming to me as a “paraplanner” who needed help, but then eventually we identified that it wasn’t that they needed help with building out plans, they need more help with streamlining their processes.

Charesse: I naturally transitioned to a consultant because after you work with so many firms, you see the best practices in the industry. That’s a very valuable service to have.

Matt: Yeah. I personally don’t see myself as a paraplanner in 10 years. I love the science of financial planning, but I really do love the art of it as well, so at some point I see myself transitioning more into a traditional financial planner role. I think what a paraplanner is, is yet to truly be defined by the profession. So I really just see what I’m doing now as a really great way to get exposure to many different firms and many different ways of doing things and picking up tips and tricks from financial planners that I work with, and ultimately helping me find my voice as a future financial planner.

Maui: I agree. I would say that we don’t know the future and what the future holds, but as far as aspirations go, to me one of the coolest things about doing virtual paraplanning is giving me the ability to think like a firm owner without having to own my own firm. Just being able to play around as an entrepreneur, I think, has been really helpful. I don’t necessarily see myself as a paraplanner in 10 years. Honestly, I don’t even know if I would be an advisor or a financial planner or own my own firm. I mean there’s just so many possibilities. But I’m just really glad that I got this experience and continuing to cultivate this experience.

Maui: I feel like it’s a great entryway into the profession where you got to exercise your business ownership chops, but also gain the technical knowledge. Whether you end up being a practitioner or more of a visionary entrepreneur, you can go either direction, I think, starting in this place as a virtual paraplanner. So I would say that for me personally, I lean more towards the visionary entrepreneurship side. Working virtually as a paraplanner, I have the time and space to dabble in different ideas on the side and work on different projects. So I’m really excited to see where that takes me. But it doesn’t just tie me down to just doing the technical work of financial planning.

Matt: On the topic of the technical side, I think that paraplanning is a really great fit for a lot of people out there who might be worried about accepting a junior planner position where they are going to be thrown into the fire of having client-facing relationships or expected to produce new client relationships. So if that is what people are looking for, I think paraplanning’s a great career path for that type of person.

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