As the financial advisory industry struggles to get young blood into its ranks, New Planner Recruiting LLC has responded by launching a stand-alone service for screening new candidates.
The firm, which traditionally focused on handling the entire placement process for students graduating from CFP Board of Standards Inc.-registered programs, is adding a backend service. It has experienced increasing demand from firms that had already done the lion's share of their candidate search in-house.
“Recently, we had been receiving a number of requests to run background on candidates who firms already considered to be a potential match,” said Caleb Brown, a founding partner of New Planner Recruiting.
The service will provide routine screening of candidates, including credit history, criminal background checks, licensing verification and references, but will also include a job personality profile and proprietary
financial planning and knowledge assessment tools.
“The challenge we've seen with the hiring of new financial advisers is that firms don't know what skill set they're getting,” said Michael Kitces, also a founding partner of New Planner Recruiting, and a partner and director of research at Pinnacle Advisory Group. “When it comes to
financial planning software, proprietary knowledge, the ability to read and manipulate spreadsheets, and even the relevancy of college coursework, firms want to know what their candidate has to offer.”
The new service should be particularly attractive because of “the wide variance in CFP programs, and thus the wide variance in the quality of entry-level candidates,” Mr. Brown said.
With high demand and a low supply of entry-level advisers, some firms jump at the chance to hire a seemingly viable candidate without putting them through a rigorous screening process.
“Lots of firms are behind the curve when it comes to hiring young, new financial planners,” Mr. Kitces said. “So there's this propensity to pull the trigger quickly without going through a proper vetting process when an attractive candidate appears.”
Mr. Kitces warns against short-selling an evaluation process though, to avoid “a lot of expensive turnover” due to the hefty costs of hiring younger advisers in high demand.
Access to the full-range of candidate evaluation tools, the platinum service, will cost $599 per candidate, while the most basic assessment comes in at $199 per candidate. New Planning Recruiting expects most firms to put through two or three “finalist” candidates at once in order to get a side-by-side comparison of their results.
