Rookie Advisors: Who Are They and What Do They Want?

To retain new talent, RIAs must focus on training and support.


Illustration by RIA Intel

The bright, young, newly-graduated rookie financial advisor is a thing of the past.

New financial advisors today are older, more experienced, and in short supply, according to a report by wealth and asset management research and consulting firm Cerulli Associates.

Cerulli found that the average rookie advisor — defined as having three or fewer years of experience in an advisory role — is 37 years old. Most are mid-career professionals who have switched jobs — just 15 percent of rookie advisors reported that financial advice was their first career.

About 43 percent came from financial services. Of those, 28 percent worked in sales and marketing, 19 percent worked as an analyst, product specialist, or portfolio manager, and 16 percent came from client services, operations, and administration. Just 9 percent, meanwhile, came from the banking industry.

About 84 percent of rookie advisors said the desire to help people reach their financial goals was a major factor in their decision to become an advisor. The majority also cited flexibility and the ability to control their own schedule, as well as the opportunity to earn a high personal income, as major factors in their decision.

Rookie advisors clearly value investment training and time spent with established advisors. Seventy-one percent of rookie advisors said that investment analysis training and support for the licensing process was very important, 64 percent believed that exposure to successful advisors was very important, and 60 percent said that mentorship from an established advisor was very important. Only about half believed that it was very important for them to receive training in sales techniques — which isn’t surprising, given that many rookies had an average of nine years of sales experience before they switched careers.

Despite the wealth of experience that rookie advisors bring to the table and their desire to help people, nearly 75 percent failed or left the industry in 2022, a figure that could indicate that there are systemic issues when it comes to retaining new advisors.

“Rookie advisors had a failure rate of more than 72 percent in 2022,” Cerulli wrote. “To succeed, they require strong mentorship, exposure to successful advisors, and training in financial planning topics — an area in which many new advisors believe they do not receive adequate support from their firm.”

Despite the fact that 71 percent rated financial training as very important, only 47 percent of new advisors claimed to be ‘very satisfied’ with the financial planning training that they received from their firm, the largest gap of any topic and an area that Cerulli says firms must invest in if they hope to improve their advisor development programs. Other areas that received low satisfaction ratings included investment analysis training, goal-setting, and training in sales techniques.

According to Cerulli, close to 70 percent of all rookie advisors are responsible for building their client base from scratch, and on average, rookie advisors are required to bring in at least $13 million in new client assets and generate $273,484 in production or revenue to meet the goals set by their firm. In order to maximize a rookie’s chance of success, Cerulli believes that “RIAs should provide ample training in business development strategies, such as nurturing a niche client market.”

Most new advisors gain clients from personal relationships and referrals from clients, friends, or family members. Rarely are they able to gain clients from their former profession or other advisors. Additionally, new advisors struggle to gain clients from CPAs, attorneys, or other centers of influence that may refer clients to advisors.

“It can be difficult for rookies to develop strategic alliances with other professionals because they often lack the requisite experience expected,” Cerulli wrote. “Working on a team or in partnership with a senior advisor can lend rookies the credibility they need to begin building these COI relationships.”

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