Getting Over A Startup Hurdle To Reap The Rewards

Most advisors in banks and credit unions resist financial planning, or go through the motions to check the boxes that management builds into the incentive program. The average number of goal plans created or updated is just one plan per month. Why don’t they embrace planning as a way to create deeper relationships with their clients, document the basis for their financial advice, and build a better business model?

New research from Kehrer Bielan, commissioned by Raymond James Financial, provides visibility into why most advisors are reluctant to take the time to know what their clients want to achieve, and how they want to spend their money.

For the average financial institution-based advisor –who produces $445,704 a year – adding an additional goal plan per month increases annual GDC by only $14,268. Since the average number of goal plans is just one plan per month, doubling the average number of goal plans created from 1 plan per month to 2 increases production for the typical advisor just 3% to $469,972. No wonder some advisors think that it is not worth it to change their business model.

But the benefits of planning accelerate as advisors embrace planning. Advisors who create or update 2 to 4 goal plans a month – the target for many firms seeking to bootstrap planning – have average GDC that is 132% higher than advisors who do only 1 to 2 goal plans per month, and 155% more than advisors who do even less planning. Advisors who create or update more than 8 plans per month produce about twice as much as the average advisor.


These findings suggest that there are significant economic, structural, and psychological hurdles for the typical advisor to embrace planning. Management’s challenge is to find ways to overcome these challenges, because embracing planning has disproportionate returns to both the advisor and the firm. Most advisors are otherwise caught in a self-sustaining cycle where investing time to learn more about their client and how to leverage planning software does not seem to have the same payoff as moving on to the next client.

You can learn more about this eye-opening research, and the levers managers can use to help the typical advisor over the planning hump, at The ROI of Financial Planning.