As we dive deeper into this profession, we find ourselves at a crossroad between financial science and financial art. More specifically, we quickly find that this industry is more focused on the "personal," than the "financial planning." Therefore, the art we look to create has to deal with combining complex financial concepts and then immediately applying them to fit our client's unique personalities.
In my humble opinion, one of the largest challenges we face as NexGen planners is being able to connect to our (usually older) clients on a deep level. The secret ingredient to having a deep connection with anybody is empathy, but sometimes empathy can be difficult to curate if we haven't faced the same life experiences as our clients have faced. For instance, I believe that I'm a great listener and communicator. But if my client has children, they might understandably have a stronger connection with an advisor who also has children. This is not a rule of thumb of sorts, just an easy example of how life experience could play a role in empathetic communication.
Ironically, our greatest advantage in this industry sometimes doubles as our largest disadvantage - our youth. Most of us have studied the textbooks, passed a multitude of exams, and offered fresh perspectives to our traditional firm's dynamics, but our presumed lack of life experiences leaves me wondering one major question - are we ready to be financial planners? And if we are not, how do we help ourselves overcome this?
Fortunately, there are programs available to help us with some of these issues. I've had a chance to explore some of the options available to young planners and recently completed one that has done a better job at preparing me for real-life financial planning than anything else has at this point.
Financial Planning Association's Residency Program
Last month, I had the pleasure of traveling to Denver, Colorado for six days to attend FPA's Residency program. While I wish I had spent more time exploring the 16th Street Mall and Coors Field, I can genuinely say that this program will serve to be one of the larger turning points of my career as a financial planner. Disclaimer: Coors Field is a professional baseball stadium in Denver, not a field of beers (sorry, guys).
So, What is Residency?
I like to refer to it as Bootcamp for the soft skills of financial planners. The program is only six days long, but the program is so dense that the CFP(R) Board awards three months' worth of experience credit towards the CFP(R) designation; that's right - three months of experience is given to FPA Residency graduates. Not bad for six days of work.
For starters, this program is not to be confused with a conference. You're essentially paying for full days of training by trial and error, role play exercises, and other real-life application of financial planning concepts to clients. So if your goal is to skip out on a few days of work for "networking" purposes, this might not be the best bang for your buck.
Speaking of price tags, the program is relatively expensive compared to other FPA events. Early-bird registration for FPA members this year was $2,500 and the price steadily increased from there. It's important to note that there was a sizable wait list this year, which proves that there are plenty of planners out there who wanted to register and would have been happy to pay the registration costs out of their own pockets. NexGen planners should be particularly mindful of this - especially those who have employers that pay for all networking and training expenses - and learn if they really want to be one of the few participants. If you are not sold on attending the event yet, I can guarantee that someone on the wait list is.
In terms of the sell-out crowd I just mentioned, there were around 35 Residents in total. The smaller size is completely intentional and a huge advantage for anyone looking to get the most out of their experience and receive individual attention from people who really know what they're doing.
Boot camp Begins
On day 1, I arrived in Denver and was picked up by a shuttle bus to take me to our Residency location - this year's event was at the Inverness hotel. Upon arriving at the hotel, we only had a few minutes to get settled into our rooms and mingle with some of the other attendees in the lobby before the main festivities began.
Once it was time, everyone found their way to our dedicated conference room - a room that we would get very familiar with over duration of the experience. Once everyone was settled, we all took turns briefly introducing ourselves to the room (much like the first day of class in grade school), including our 6 mentors. These mentors were all experienced financial planners and it was clear that they all genuinely care about the advancement of the industry. Most of these mentors regularly publish articles in periodicals like Financial Planning magazine, Journal of Financial Planning, and so forth, so most of us were already familiar with most of them (and perhaps a little nervous to meet them).
I specifically recall being impressed by the distances that all of the Residents were willing to travel to attend. There seemed to be a strong San Francisco Bay Area presence, but I was also acquainted with planners from places like Texas, Florida, Tennessee, and seemingly everywhere in between.
As I mentioned, there were around 35 Residents in attendance. Shortly after general introductions, we were then split into small groups of around 6-person teams. And for each team, there was an assigned mentor to help guide the teams along as they needed. The small size of each team was a critical piece, as it gave everyone a chance to share their voice and gain some one-on-one time with their mentors. It should be said that our assigned teams were completely random and participants should expect to get very close with the people you're assigned with, as you will likely spend more time with them than anyone else over the program.
Almost immediately after introductions, it was time to get to work. Our teams gathered and met in a smaller, more intimate conference room to begin. Our first task was an ice breaker exercise. I won't go into details, but let's just say that you quickly get to know the personalities and dynamics around you. My initial reaction was something like, "this is going to be a long week..." I found that that my inner-thoughts were completely normal for this opening exercise.
After every activity like this, we had a chance to bring our conclusions back into the main conference room and formally present our ideas to the entire class. Naturally, the spokesperson for the team is someone who is comfortable with public speaking, but the team members who were shyer were only delaying the inevitable, as there would be plenty of other opportunities to do some public speaking.
Once the icebreaker activity and presentations were complete, play time was over and it was time to jump straight into content. If I had to consolidate the subject matter, I would say that we focused on two core topics: client discovery and presentation.
The mentors began each of the core topics by walking us through in detail how their specific firms engage clients in these particular topics. Once we learned about their firm's approach, the Residents were able to jump in and ask anything they wanted. After the Q & A session, we would jump straight into role-playing, where the real (painful) growth begins.
As I mentioned, the two main focuses were on discovery and presentation, but it's important to say that the emphasis underlying of every exercise was on client communication and empathy. It was made very clear that everything we do as financial planners should be viewed through the lens of empathy and trust, and that begins with great communication. Regardless of which exercise we were practicing, the immediate feedback we received was largely in terms of how we communicated with our "clients" during the role-plays.
A huge disclaimer was made during introductions letting us know that Residents are already expected to understand the technical aspects of financial planning, so the mentors spent most of their time critiquing our soft skills and delivery. This is an important note for prospective attendees to be mindful of; you will not be tested upon your technical knowledge, but rather how you communicate that knowledge.
The single largest benefit to the program was being able to practice being vulnerable (in front of a group of people) and then receiving feedback on our performances from some highly-seasoned financial planners who were watching and listening closely. After each exercise, each mentor had a chance to speak and give unique, individual feedback on what just happened - it was absolutely invaluable throughout the entire program.
Who Should Attend?
As I hinted at earlier, some technical skills in financial planning are a prerequisite. You simply won't be able to focus on crafting the art if you are still trying to understand that science. Indeed, we were expected to come up with some technical financial planning recommendations and present them, but we were not graded on the science whatsoever. The focus was on how we presented the material, as opposed to what that material actually was.
For those who have just taken the CFP exam (or are studying), Residency is a perfect opportunity to learn how to take those concepts from the exam and learn to apply them. For the NexGen audience specifically, the experience is huge. Most of us are still essentially "advisors in-training" and this program gives us a chance to practice at a deeper level while getting mentorship from some strong minds in the industry.
I met some great people at Residency, but again, it was not a networking function. The primary focus is to spend close to one week in closed quarters to focus on building the skills that are proven to create and build trust with our clients.
Residency was one of the turning points of my financial planning career and anyone who is relatively new (or just wants some good practice) is highly encouraged to attend.