What new RIAs should look for in their talent

Like birds heading south for the winter, heads of small and big firms alike are continuously moving toward the independent space. Naturally, more will soon go RIA.

Schwab estimated in their 2024 RIA Benchmarking Study released this year that the RIA industry will need to hire 70,000 new advisors and wealth management industry professionals over the next five years to handle growth and clients' needs.

With that, more advisors will be looking for new jobs and roles in newly established RIA firms. For some advisors, going independent “is not easy,” said Andrew Evans, CEO and founder of Rossby Financial.

“Even when you have a consultant working with you, it's not easy. You still need people around you. Within my first week, I started to collect people,” he said, recalling he needed someone to maintain operations, look after the bookkeeping and financial advising. 

So what should new RIAs look for as they hire their own talent?

Rather than focusing solely on technical skills, Evans places a premium on personality traits and cultural fit.

"We are more relationship-based," he said. As an example, he points to hiring a recent employee he met through a gym and stretching company, drawn to her demeanor and level-headedness.

“For us, personality traits are more important than the technical aspect,” Evans said. “Through that personality trait, we can then start to see other things about how they treat people, like how do they respect themselves? Are they able to also build boundaries?”

For producing advisors, Evans’ process is more clinical, evaluating both attitude and past performance. The key question he asks his prospective staff is whether they’re willing to "subjugate your own branding or ego interests to be part of this collective."

That’s why Evans is always prospecting for next-gen advisors.

“I like to hire young, who are intelligent, hungry, humble. That's what I look for,” he said.

Consequently, instead of relying on recent graduates, other advisors have found success tapping into the pool of career changers looking to transition into financial planning.

"We really see the value of career changers," said Hannah Moore, founder of Guiding Wealth and Amplified Planning. "There's a huge talent pool that's been largely untapped from the career changer standpoint."

Through Guiding Wealth's externship program, Amplified Planning Externship, which has trained more than 4,000 aspiring financial planners, Moore has built a pipeline of candidates with diverse backgrounds and perspectives.

As for the kind of talent Moore hopes to bring into to align with Guiding Wealth’s values, she seeks individuals who are passionate about the work.

“We want the people who care,” she said. “We can teach you technical skills but we want somebody who considers this their passion. This is what they want to do and this isn’t just another job. They see the impact they can have on somebody's life.”

While some RIAs will typically hire a junior advisor to help with financial planning, responding to calls and emails as well as data tracking and bookkeeping, one advisor said that could be a grave mistake.

“That's not actually a good first hire,” said Colin Day, financial advisor at Correct Capital, who also manages the firm's hiring.

“A good first hire is actually somebody that can handle all the admin tasks for you so that you continue to do the things that bring in new clients, which is prospecting and building plans.”

Ultimately, the goal for most new RIAs should be to find candidates who can not only excel technically, but also thrive in client-facing roles, Day said.

 "All the people who work in our office are going to have some kind of client-facing role, so they need to be able to talk to us and then talk to the clients,” he said.

For instance, Correct Capital also takes their prospects to lunch or breakfast to see how they interact in a more casual setting and with other staff, he said.

CEOs of independent firms already juggle many responsibilities, so outsourcing or delegating recruitment is often the smartest use of their time, said Ashley Folkes, vice president and wealth manager at Farther.

“This allows them to focus on running and growing their business while ensuring they bring in the right people to help them succeed,” he said in an email.

Independent RIAs have a great chance to develop and focus on their unique core values, unlike big firms with generic, outdated ones, he said.

“They can hire and fire based on what really matters to them, creating a team that fits their vision. Staying true to their values naturally draws in talented people who share those beliefs.”

“That’s when you know you’ve built something meaningful, a business where culture and purpose truly shine,” he said.