Don't Outsource Yourself

What financial advisors should and shouldn't outsource

As a financial advisor grows their practice there will come a time when they simply need help.

Help with paperwork, filing, scheduling, service work, the list goes on.

Advisors usually start by doing all of these things themselves but should eventually outsource almost everything so they can focus on revenue producing activities.

When I started in 2006 I did everything myself but quickly realized there is only so much time in the day and started to question why I was doing tasks that albeit were important where not what I was really supposed to be doing which was being a financial advisor, not an administrative support person.

The W2 Situation

I initially started hiring in-house W2 employees to do the important work that I wasn't supposed to be doing. Why? Everyone else was doing it so I figured that is what I was supposed to do.

I quickly found out that although some W2 employees can be amazing and be an integral part of your business, it is not always sunshine and puppies! W2 employees can also become a major burden. Even the best ones can still be a financial drag on your practice and for younger advisors a real challenge to bring on board.

W2 employees cost more than just their wages. You have to pay FICA, worker's comp, PTO, and variety of items to outfit their office. These are significant costs and when your revenue is only so much can make a huge difference in "making it" or not.

After having tried the W2 game for some time I had had enough. I had always felt there was a better way to do things, and I found out there is.

As I transitioned my entire practice to a virtual one starting back in 2013 it was only natural to consider hiring virtual assistants for all of the things I needed help with.

This is a diagram of what my team looks like today for my firm Intrepid Wealth Partners.

My team for Conneqtor has been built the same way, entirely virtual.

There are a number of best practices for hiring and managing a virtual team which I talk about a bit more on my blog but am not going to expand on here. But rather focus on what I learned on what you should and should not outsource.

Avoid this outsourcing mistake

One of the biggest mistakes I see financial advisors make is that they think by outsourcing their marketing (digital, social, etc.) that all of their client acquisition problems are solved. In other words they are trying to outsource themselves. Say what?!

Part of an advisors job is to grow their business by bringing in new clients. We do this by Marketing Who we are, What we do, and Who we do it for, all with a personal/human touch.

So it is only natural that we actively participate in the marketing efforts needed to acquire new clients. We used to call this Prospecting, now it is Digital Marketing.

A lot of advisors have been led to believe that by outsourcing all of their marketing that some magic happens and new clients just start popping up, for the most part this is false.

Instead of going to a networking event would you hire someone to go for you and tell everyone about you? Of course not! That would be weird and creepy.

The same principal holds true with digital marketing. It is a first-person game. And really, can you actually outsource yourself?

What you should and should not outsource

Financial advisors should know how everything in their practice works. As soon as they get too busy to do the non-revenue producing activities themselves they should consider outsourcing it. This is how you grow exponentially.

By knowing their own systems and processes it is much easier to not only teach it to those you hire but also spot check things and realize quickly when things are not working right.

But you said I shouldn't outsource my marketing? Yes, I did, kinda. Things like posting on LinkedIn should never be outsourced. At the end of the day you can't clone yourself and people will know if someone else is posting on your behalf.

All of your blogs and other digital marketing should, at first, be done by YOU. Why? Because eventually you can outsource the bulk of this work now that you have a database of content your virtual digital marketing team can get familiar with to know your style, type of writing, persona, etc. Now they can much more easily replicate who you are in the content they create with you still getting the final edit and approval before the content goes live.

Eventually advisors should outsource almost everything, including some of their marketing, so they can focus on working with their clients. This process takes time. Don't be mistaken or misled that by outsourcing things right away that it will solve your problems. Most of the time it won't solve anything but leave you frustrated with a lack of results and no ROI on your investment.

The Virtual Solution

I have built two successful companies with 100% virtual teams. Virtual assistants have been around a long time and only gained credibility and popularity with all that happened in 2020.

Virtual staff cost less but are no less valuable. My teams are amazing people. They are like family. They care about my two companies like they are their own. They fight for me. They get things done. I have never met them in person.

Sure, there is a learning curve in building a virtual team, but isn't there one in building a traditional W2 team? Wasn't 2020 a learning curve for the world?

If you are frustrated with your current "staff" situation or are looking for a great way to grow and scale then I would encourage you to consider building a virtual team.

Either way, please, don't ever outsource yourself. We are in a people business. People want to work with us, not the products, services, returns, etc. that we help them with. Show people who you are through your digital marketing efforts. Done right, you will have more business than you know what to do with.

What have you found to be your biggest win in having a virtual team?

Wishing you all the best,

Derek Notman