Here's the Secret to Strong Female Advisor Mentoring
It’s widely accepted that the retail financial advice industry and the retail investor population are in need for fresh blood, particularly millennial women, who can help address the shortage of younger, female financial advisors. Unfortunately, however, many of the young women that have entered the industry in recent years haven’t stayed. And one of the biggest reasons why is the lack of guidance and support from more seasoned advisors who can serve as mentors to these younger women advisors.
While the obvious solution is for broker-dealers to establish more effective female mentoring programs, the devil is very much in the details. It’s hard to find a firm today that doesn’t acknowledge the importance of female mentoring, but how do you create a mentoring program that is positioned as well as possible for success?
As we assembled some of our latest research findings in the run up to this year’s Ladenburg Institute of Women & Finance Annual Symposium, an event focused on supporting women financial advisors, we identified three of the most important considerations for firms seeking to align the best possible mentor with female millennial advisors:
Business success alone is insufficient; the mentor’s practice must reflect the needs of the fiduciary era. At one time, the three most important qualities a would-be mentor needed were business success (frequently in terms of annual practice revenues), enthusiasm for imparting guidance, and availability in terms of time. These factors are no longer enough. Firms seeking to position their millennial female advisors for success must seek a mentor whose business is built on providing holistic financial planning – which is where the future of the financial advice space is heading – and has a demonstrated ability to build female professional and social networks to help develop female client relationships. Finding this type of mentor will significantly enhance a female millennial advisor’s chances for long-term success.
Look for individuals who approach change the same way emotionally. Emerging research suggests that one of the most important factors that determines whether a mentor-mentee relationship succeeds is how each person views and copes with change. Is change viewed as an opportunity to press forward and capture new opportunities? Or is it viewed as potential chaos that must be carefully managed with the goal of reaching the most stable and structured long-term outcome possible? A mentee who thrives on change will work well with an aggressive advisor who isn’t shy about providing candid criticism on what the mentee should consider doing differently. By contrast, a mentee who sees change in more cautious terms will be a better fit with a mentor who offers feedback and suggestions more subtly and incrementally.
Avoid the “mini-me” relationship. While the concept of cloning and creating a “mini-me” was entertaining in the Austin Powers movie franchise, it’s not such a great idea when it comes to financial advisor mentoring programs. Given the differences between how millennials and older generations tend to communicate, mentees should focus less on becoming a younger carbon copy of their mentors, and more on mastering critical ‘hard skills,’ including time management, client engagement messaging and portfolio construction.
Everybody has a unique personality and a style that goes with it. Learning the right fundamental skills and enjoying the benefits of access to a seasoned mentor who can serve as a strategic sounding board makes much more sense than trying to unlearn one’s personality.
Mentoring programs pairing junior advisors with more senior industry professionals have been around for years. Some have been more successful than others.
With planning and careful thought about some of these basic building blocks, firms and veteran advisors can ensure success for female mentoring relationships going forward and, more importantly, for a whole generation of promising female advisors.