From as early as six weeks after their birth, Rebecca Horwood started introducing her daughters, Alexandra and Rosemary Horwood, to her clients at the Richardson GMP investment firm, then Richardson Partners.
“They have been part of the business since they were born,” she says. “Whenever we would host a client event at our office, the daughters would come to help, and they were part of it … I wanted to really signify to the clients the family.”
So when they both graduated from the University of Waterloo, with multiple corporate internships under their belts, it seemed the logical next step was to bring them onto the team at Richardson GMP, where Ms. Horwood currently serves as portfolio manager and director of the Horwood wealth management team.
As both were considering several postgraduate job offers and were unsure of where to go next, Ms. Horwood gave each daughter a three-month contract with an entry-level salary, and urged them to build their own client books, just as she would any other newly hired junior financial advisor.
“As a result of doing all the grunt work and spending that three months, Alexandra said, ‘You know what, Mom, I’ve decided not to take all these other jobs. I’ve decided to build my own book here with you guys.”
Her second daughter soon followed suit, and both daughters have since gone on to develop their own wealth management teams within Richardson GMP: Alexandra Horwood & Partners, and Rosemary Horwood Wealth.
And while Ms. Horwood says her ability to master family succession is a rarity among Canadian wealth management teams, her daughters aren’t the only young minds she’s empowered at her firm. In fact, she’s mentored a number of millennial-aged advisors at Richardson GMP as they developed their client bases. Four of the 20 millennial advisors named on Wealth Professionals Canada’s Young Guns 2018 list come from Richardson GMP, more than any other firm in the category – a testament to the ability of managers such as Ms. Horwood to integrate young talent into a challenging industry.
To Ms. Horwood, bringing a young financial planner into a firm is not a simple feat, but rather one that takes five years of shadowing and mentoring.
“It doesn’t happen momentarily, we do things very easy and very slowly,” she says.
One of the greatest challenges that firms face when hiring is helping young advisors to establish a client base. Reassigning the firm’s existing clients to them runs the risk of angering, even potentially losing, clients. Simultaneously, most new advisors enter the firm without an existing book of business, and have to start one from scratch.
According to Scott Plaskett, senior financial planner and CEO at Ironshield Financial Planning, the commission-based pay structure of many firms puts “enormous” pressure on junior planners just starting out.
“Even if the right approach is to have a good value-based conversation with a client, the bottom line is, you have to pay the bills, and so if you don’t sell something, you’d better find a quick way to that sale,” Mr. Plaskett says.
He says the biggest challenge for new advisors is not having a baseline salary to start off, so they can “take a bit of a breather” and “go through a true value-based financial planning process.” This in turn allows junior planners to develop strong client relations and place their clients’ values and desires above their own need for wealth creation.
Ms. Horwood’s first step to help junior advisors navigate the pressure of starting off is to have them shadow more senior advisors at Richardson GMP for several years before assigning them clients.
“With the millennial advisor, one of the things that’s really clear is that it’s going to take years,” Ms. Horwood says. “They have to spend a lot of time shadowing the advisors … really making sure you know all the operations.”
Once they’re ready, she typically starts them off with more manageable “small clients,” often those with lower wealth, but who offer the firm long-term returns through their connections to other prospective clients. From there, any prospects that come out of the advisor’s work with their initial client are assigned to the same advisor, and the junior advisor builds their business book from there.
In the instances in which Ms. Horwood transitions existing clients to new advisors, it has almost always gone smoothly for both parties, she says.
Part of her strategy for executing this move is to provide the new advisor with ample opportunity to establish rapport with clients before assigning them cases to ensure that it’s “more the client’s idea” to team up with a young advisor. Her goal is to “make the assistants experts in one area,” so that clients not only know their name but trust them with a certain skill or expertise, and will eventually trust them with their wealth.
For example, when one advisor started at Richardson GMP, before assigning him cases, Ms. Horwood asked him to help create PowerPoint presentations for speakers at a conference where the firm was acting as the host. A natural computer whiz, the then-junior advisor made a strong impression among the clients he helped, developed rapport, and eventually made it easier to assign clients to his case.
“You’ve got people on the team who have a strength, and they work their way in, and it’s all through relationships. Everything is relationships.”
Ms. Horwood can cite only one instance in which a client was hesitant to switch advisors, and with the “client-comes-first” ideal in mind, she chose to give in to the client’s concerns.
“We said ‘fine,’ because that’s only one client,” Ms. Horwood recalls.
And while much of the success of the young investment planners at Richardson GMP can be attributed to Ms. Horwood’s mentoring tactics, she’s not at all hesitant to admit that much of this talent comes from the young planners themselves. Ms. Horwood values young staff who are ambitious, “emotionally mature” and willing to put the firm’s team and their clients above all else.
“I want to see a self-starter,” Ms. Horwood says. “If a person is not a self-starter … I have no time or patience to teach a person a job.”
These qualities are becoming more and more important, she says, and it becomes increasingly “hard to get in the business.” But many of these highly educated young candidates, equipped with many skills that senior advisors lack in terms of efficiency and technical savvy, can bring a lot to a financial planning firm.
“No one can really compete with these young people who are coming out of university,” Ms. Horwood says. “All the technology that young people have today … they need to leverage that and make processes more efficient.”