Recent research from McKinsey & Company reveals the number of households seeking holistic financial advice and a willingness to pay for it has doubled in the past five years. Clients are also ready to pay a premium for human advice, with almost 80 percent of affluent households stating that they would pay a premium of 50 basis points or more for human advice as opposed to a customized digital advice service priced at ten basis points.¹

At the same time, the study revealed that the shortage of financial advisors will reach 100,000 within ten years, equaling one-third of the total needed—a developing trend that will impact the wealth management industry’s ability to meet the rising demand for a full spectrum of planning services.¹

To meet the rising demand for a full spectrum of planning services, firms will need to both increase productivity and attract thousands of new planners over the next decade. Accomplishing this will require the systematic application of a broad set of levers, from productivity initiatives to advisory team structures and hiring models.

Advisor Teaming

Advisor teaming is when you form groups of planners who work together to serve clients, ultimately benefiting both planners and clients. The collaborative model results in enhanced productivity as teams collectively manage more clients and tackle intricate cases with streamlined precision. Clients benefit from having access to a diverse spectrum of viewpoints and the assurance that there will always be a planner available to work with. Additionally, it cultivates a culture of knowledge sharing among team members, which fosters continuous professional growth for everyone on the team.

How to implement:

• Develop training programs: Set planners up for success by offering training sessions to help them understand the benefits and dynamics of working in teams.
• Invest in collaboration tools: Look for technology that facilitates communication and collaboration among team members.

Specialized Support

Bringing in or partnering with experts in areas like tax planning or estate management can elevate your service offerings to meet diverse client needs effectively and efficiently. This approach allows planners to focus on their core competencies while still ensuring that clients receive comprehensive advice, leading to more informed decision-making and tailored solutions that align with their unique financial goals.

How to implement:

• Hire specialists: Recruit experts in various fields to provide support to planners.
• Develop partnerships: Form alliances with external specialists to offer clients a wider range of services.

Optimize Operational Efficiency

Incorporating new strategies and tools to optimize the operational efficiency of your financial planning practice will be critical for expanding your client base. Through the implementation of streamlined workflows, you not only make better use of your time and resources but also create a foundation for enhanced productivity and client satisfaction.

How to implement:

• Develop processes and workflows: Create a service calendar and workflows for tasks like client acquisition, onboarding, and delivering financial plans.
• Manage your tech stack: Integrate your technology solutions to automate and manage various aspects of the practice.
• Continuous training: Provide ongoing training to keep advisors updated on the latest management techniques.

New Recruiting and Staffing Models

Embracing innovative approaches to recruiting can lead to a more diverse talent pool, increased recruitment, and higher retention rates. In addition to implementing new recruiting approaches, firms should also look at their staffing and compensation models. As new graduates look for steady salaries and benefits, the compensation models of the past will not be an effective incentive to enter the industry. There are also opportunities to offer different career paths within your firm, such as non-client-facing support roles.

How to implement:

• Target career changers: Recruit professionals from other industries who may have valuable, transferable skills.
• Conduct on-campus recruiting: Partner with educational institutions to recruit new graduates.
• Develop internships and rotational programs: Offer structured programs to give new hires a comprehensive understanding of the industry.
• Create clear career paths and compensation structures: Defined career paths provide employees with a path for professional advancement, while well-structured compensation packages incentivize performance and retention.

Digital Experiences

When it comes to optimizing your financial planning practice, embracing digital experiences is key. By automating routine tasks, technology allows planners to dedicate more time and energy to tackling complex issues and providing tailored solutions. Digital tools also play a pivotal role in boosting engagement and satisfaction by giving clients access to services and information anytime, anywhere.

How to implement:

• Use a platform with client portals: Secure online portals enable clients to access their financial information and interact with planners.
• Offer virtual advisory services: Offer video conferencing and other virtual services to reach clients remotely.
• Consider AI-driven tools: Leveraging artificial intelligence technologies can offer opportunities for efficiency, personalization, and data-driven insights.

Prepare for the Future of the Financial Planning Industry

As the demand for comprehensive planning services continues to grow, addressing the looming shortage of financial planners will be crucial for the financial advisory industry. By implementing a variety of strategies to increase productivity and attract new planners to the fields, firms can prepare to meet the rising demand for their services without sacrificing client satisfaction.

Sources:

1. The Looming Advisor Shortage in US Wealth Management. McKinsey & Company. February 2025.

DISCLAIMER: The eMoney Advisor Blog is meant as an educational and informative resource for financial professionals and individuals alike. It is not meant to be, and should not be taken as financial, legal, tax or other professional advice. Those seeking professional advice may do so by consulting with a professional advisor. eMoney Advisor will not be liable for any actions you may take based on the content of this blog.

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