Hire Help for Your RIA with Interns and Paraplanners

As your financial planning firm grows, you enjoy some success, and you bring on more and more clients, you’ll quickly find that you’re faced with one of those issues people refer to as a “good problem to have.”

When you grow, you hit roadblocks in your firm in terms of growth and client service. You’ll also find that there are many tasks you aren’t good at or simply don’t enjoy doing, which can be a real drain on you as you try to run and grow your practice.

These tasks may be marketing related. They could be really in-depth tax analysis or estate planning analysis — and even though you’re a financial planner, your expertise lies in a different area.. Perhaps the tasks you’re not good at and take up too much of your time include bookkeeping or administrative, back-office work.

But there is a solution, thanks to new options for hiring people on a part-time, virtual basis.

New Options for Hiring Paraplanners

It wasn’t too long ago that, in order to hire a paraplanner, you basically had to get your revenue up to $60,000 to $80,000 a year — and then you ended up spending $60,000 on hiring and training a paraplanner. Hiring meant your business took a major hit to revenue.

But now you can actually hire a paraplanner or an intern on a part-time basis for your firm in a much more cost-effective model. You can also make a virtual hire, and in fact, many talented professionals in the industry see this as an added benefit for them.

You both can work whenever, wherever, as long as you have an internet connection. Looking for part-time, virtual workers means you have a bigger talent pool to choose from. This setup allows other financial planners to pick up work on the side — which means you can hire someone who already has a full-time planning job.

Or you could hire a young planner that has recently started their own firm. The XY Planning Network has many advisors with 10 to 15 years of experience, CFP® designations and other credentials, and the knowledge that would greatly benefit your company — and who would be thrilled to work in your firm for 5 to 10 hours a week.

Working virtually further helps keep costs down for your firm, too. Making a hire doesn’t mean you need a physical office space to bring that person into.

XYPN recently launched a Job Board to help facilitate connections like these: firm owners looking to hire part-time, virtual help.

The Benefits of Part-Time Paraplanners

By looking for part-time help, you’ll gain access to incredible, rockstar talent that you normally couldn’t afford. Going by the old way of doing things — just hiring someone as a full-time employee — that person would cost you $60,000 or more.

But now, you can get them in your firm for five to ten hours a week. And five to ten hours a week is plenty of time to get significant help with plan writing, writing of new plans for initial engagements, some of the project-based research you may be doing, investment research, preparing for upcoming meetings, following up with prospects, handling marketing, and more.

While there are currently no industry surveys to say what part-time paraplanners make, anywhere in the $25 to $35 per hour range should be sufficient in order to compensate paraplanners who are happy with the work that they’re doing.

Beyond receiving help with the actual tasks at hand in your business, making a hire also forces you to define your process. When you bring someone into your business, you need to train that person — and that requires a fined task list, processes, and workflows.

These are critical elements to the long-term success of any company, but many advisors don’t consider this when they’re just getting started and running a one-person shop. Creating workflows will make your entire practice run more efficiently.

What About Interns?

Creating an internship within your firm is an extremely valuable way to give back to the profession. Most of us have desire to help push the profession forward, and one way to do that is to help younger advisors who are looking to break into financial planning. Internships provide one way for those new planners to understand what the career of financial planning really looks like.

This is particularly important in the fee-only space. There are always internships available at Morgan Stanley, Merrill Lynch, and Edward Jones, and young planners see nothing but the sales side of the financial advice industry.

Network co-founder Alan Moore believes this turns off a lot of people to pursuing a career in financial planning, so we encourage established advisors to consider bringing an intern into your practice — if for nothing else, to help show them what real financial planning is.

That being said, there’s much more to hiring an intern than doing so out of the goodness of your financial planning heart.

Firm owners benefit from hiring interns, and here’s why: younger planners who are college students getting their degree in financial planning are earning an incredible education. They are learning so much about how to create plans and getting so much technical knowledge that they will become invaluable to your firm from day one.

They can do analysis, they can run retirement projections, they can work with clients because they’re already doing that in school. College students in financial degree programs today can do all of these things that, for many of us that didn’t get a degree in financial planning, took many years to be comfortable doing the type of work with interns are doing.

Similar to paraplanners, interns can also provide you with some structure within your business, and force you to develop value processes, policies, and procedures. And similar to paraplanners, interns deserved to be compensated for their work.

We could get into a discussion on the legality of asking interns to work for free, but at the end of the day we believe the practice is simply unfair. If you’re in a position where you’re benefiting from the work of an intern, provide them with financial compensation.

But What Can a Part-Time Hire Do?

Here’s the short answer: a paraplanner or intern can do most of the things you do. If you’re not sure where to start, consider downloading RescueTime, an app that tracks how you spend your time.

This will allow you to see all the different tasks you do, which may help you identify what you can hand off and outsource. Then ask yourself, honestly, what do you need to be you to do? What do you have to do as the firm owner?

The answer is probably meeting with prospective clients (as well as meeting with existing clients), setting the overall business strategy, and managing high-level work in the firm. But for the most part, when it comes to the actual planning operations and the planning work, you can hand off that work to paraplanners.

Paraplanners can help with day-to-day work specifically around client plans, doing the analysis and the research, pulling the other documents, data entry, helping open accounts, re-balancing — all of the pieces that it actually takes to do the back-end of financial planning.

With interns, their work can depend on how long you want to retain them in your business. If they’ll only work with you for one semester, allow them to help by sitting in on client meetings and doing some the analysis. You can also give them one big project to work on, like a technology review, defining your planning process, developing a marketing strategy, or leveraging social media.

If the intern is going to be with you longer term — a year or two until they graduate — then they will probably do less project-based work and more tasks that are in line with work a paraplanner would do. If you already have a paraplanner, they can start handing off tasks and manage that intern for you.

Jude Boudreaux of Upperline Financial Planning used XYPN’s job board to help find a paraplanner when his firm started to grow rapidly. Though he didn’t want a full-time staff member, he needed help — and figured other planners with experience who were starting their own firms could benefit him and would appreciate a little extra cash from a side job.

He hired a paraplanner on a part-time basis for 5 to 10 hours per week. They work virtually, and their main task is to onboard and process new clients.

Sophia Bera, founder of Gen Y Planning and an XYPN member, has experience in hiring paraplanners, too. Her paraplanner also works virtually between 5 and 10 hours per week.

They cover a number of tasks, including prepping client review meetings, working on financial plans, handling asset allocations for 401(k)s, reviewing company benefits, and writing 1-2 page meeting summaries for clients.

Thinking About Compliance

As with all things in our industry, compliance is something to consider when you want to make a new hire. We spoke with Jim Cullen of Financial Planners Assistance to understand what advisors need to think about when bringing on a paraplanner or intern.

Cullen says the main concern for most firms will be the protection of client and firm data. “You will need a non-disclosure agreement in place, and I recommend ensuring suitable equipment is used,” he explains.

This might mean locking cabinets if they have access to physical client info, placing anti-virus and firewall protection on their work computer, and using a shredder for disposing physical information. You can also provide your firm’s privacy policy and ask paraplanners sign a noncompete if you feel it’s necessary.

New hires do not need to be listed on your ADV if they’re only doing clerical work. “If they do more than that — and if they are associated with the firm as an employee — then you would count them under Item 5 of the ADV Part 1,” says Cullen.

How to Find a Paraplanner or Intern

Again, XYPN just launched a job board specifically for virtual part-time paraplanners and interns. If you’re looking for someone on a part-time, virtual basis, leverage that resource by creating a job posting to find someone to work within your firm.

If your firm is in a position to bring on a full-time paraplanner, check out New Planner Recruiting. The group can help match you with a planner who makes a great fit for your firm. (Note that New Planner Recruiting handles full-time hires, so this is a resource for those ready to bring on a full-fledge salaried person.)

Other places to look might include the FPA’s Career Center or NAPFA’s Career Corner. The CFP® job board may be a good place to post, and you can also check with your custodian. They may have services to match you with an intern.

You can go to the local universities that have degree programs in financial planning or CFP® certificates. To look up certificate programs, go to the CFP® Board’s website under their education section.

From there, you can find all the registered programs in your area and go and talk with the students, talk with the main professor, or the program director about what you’re looking for and they’ll be able to make recommendations for students that they think would be a really good fit for what you need.

Don’t forget word-of-mouth networking, too. Put the word out with other planners in your area; they probably have folks approaching them looking for jobs and they will be able to point people in your direction.