One Of The Fastest-Growing Careers Is In Desperate Need Of Young Talent

The financial advisor profession is expected to boom over the next decade with a 32% growth rate.

The job market is an ugly place right now but there�s a segment of the financial industry in desperate need of young talent.

Finance jobs are typically associated with white-shoe investment banks or the opaque world of hedge funds. Everywhere you turn though there�s another report about job cuts on Wall Street or yet another hedge fund strugglingto beat the market. However, there�s one financial job that�s remained secure and increasingly relevant in today�s market: the financial advisor.

�From the heights of the most frenzied bull markets, to the depths of the worst bear markets even as other professionals within the same industry are laid off, financial advisors today who are compliance clean, who generate a substantive amount of revenue, have the most secure job in the world,� says Danny Sarch, a Wall Street recruiter and Forbes contributor.

Why? The demand for financial advice is increasing as Baby Boomers approach retirement and seek help getting there. Couple that with the fact that the average financial advisor (FA) is 50-years-old and you�ve a golden career opportunity for young graduates and professionals.

�Financial advisors are in a business that profoundly impacts the lives of their clients. It�s financially rewarding, there�s a degree of independence, it�s intellecutually stimulating. But for some reason we are having a difficultly making it a compelling choice for a large number of people looking for a career,� says Mark Tibergien CEO of Pershing Advisor Solutions, a BNY company.

Indeed, there�s a great shortage of young talent in the financial advisory world. Less than 5% of the existing 316,000 financial advisors in the country are under age 30, according to Cerulli Associates. Plus, existing advisors are on the path toward retirement themselves and looking for younger FAs to take on their books of business.

That�s why the FA world is expected to boom over the next decade with a 32% growth rate, according to the Bureau Of Labor Statistics. The average growth rate for all occupations is 14%, according to the BLS. The median pay for an FA was $64,750 in May 2010 but it could reach 4x that amount depending on the location and the type of advisory practice you work in. Plus, if you�re part of an independent practice there�s opportunity for an equity stake in the firm.

So, what�s the first step in becoming an FA? A bachelors degree is key, and certain certifications like the Certified Financial Planner (CFP) designation are a big plus.

But advisors come from all different backgrounds. Take Eve Kaplan, for instance. She�s a fee-only advisor (meaning she does not collect a commission) who runs her own advisory practice in Berkeley Heights, NJ. Before launching her financial career she was living in Japan and teaching history there. She had a change of heart. �I pulled my Plan B and got a CFP and opened my own practice,� she says.

She�s currently looking to hire a young advisor but is having trouble finding candidates. �It�s a mystery to me as to why there�s a shortage because this is such a great field to work in. Everyday I get to see how I�m helping clients,� she says. The key things she�s looking for are computer and organizational skills.

�Even more than finance is the ability to learn and not think any one thing is below him or her,� Kaplan says.

One of the big misconception people have about her job is that she must have deep math and finance background. �I was a Ph.D. in Japanese History. It helps to have your CFP but a lot of it is on the ground training�be a mentor while that person is learning,� she adds.

There are some barriers to entry, though. A decade ago, Wall Street brokerage firms like Merrill Lynch, Morgan Stanley, UBS, Smith Barney served as significant training grounds for young financial advisors. Their elaborate training programs produced some of the most successful advisors in the industry today. But those programs all but diminished as cost-cutting has become a major concern on the Street sending the number of new FA entrants to an all-time low. (Recently, some firms have tried to revive their training programs though far from their peak levels.)

Jonathan McQuade, Director of Business Management at the Ensemble Practice, says another reason for the shortage is a disparity in expectations. Wall Street�s brokerage firms expect trainees to hit the ground running and develop business very quickly. �Most of the advisors today started in an age of cold-calling. Not many college grads are attracted to that anymore. They want mentoring and a comfortable learning environment,� McQuade says.

Where there tends to be more mentoring and less of a �eat what you kill� mentality is on the independent side of the financial advice industry. Independent advisors are entreprenuers who run their own advisory business�they�re paying their own rent, turning on the lights in the morning and hiring their own staff. Unlike Wall Street�s brokerage firms where advisors are paid on salary and commission theses advisors are typically paid on a fee-only model where clients pay them a percentage on the assets they manage.

The independent advisory model is where McQuade expects to see the most growth in terms of new, young advisors.

�Independent advisors have more flexibility to plug in a younger advisor into an existing team without putting immediate pressure on him or her to start producing revenue. Wall Street wirehouses are trying it out too by aligning younger advisors with older ones but the younger broker is still expected to blow up his own raft,� McQuade says.

Various models aside the overall financial advisory industry needs a wave of young professionals to fill the gap. The average advisor at age 50 is going to start thinking about his or her own retirement and will need a succesor in place. Ideally, that advisor wants to transfer the business to an advisor he�s trained himself and who knows and understands the client base.

�Young advisors are generally most successful when they are working under an older, more experienced team,� says Eric Sheikowitz c0-founder of Focus Partners.

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