April 2015 10 Questions

Caleb Brown on Career Paths, Hiring Mistakes, and Advice for New Grads

Journal of Financial Planning: April 2015


Who: Caleb Brown, CFP®

What: Planner, founder of New Planner Recruiting, Kolbe Certified™ consultant, speaker, mentor

What’s on his mind: “Getting a job is not really the challenge. Finding the right fit and succeeding in the profession—that’s a completely different story.”

Podcast: Click HERE for our podcast page

You’re a bright, energetic, and well-educated recent grad from a financial planning degree program, but you lack experience working with clients. You’re ready to work, but finding a firm owner to “take a chance” on you proves difficult—firm owners prefer you have some experience. As a result, you and many young grads who would have grown into wonderful planners can’t find jobs that are the “right fit,” and you end up leaving the financial planning profession.

When Caleb Brown, CFP®, saw this happening around him in the early 2000s, he made a commitment to helping new entrants to the profession. He initially made good on that commitment by implementing the first FPA Career Day at his Dallas/Ft. Worth chapter. Career Days are now popular events at FPA chapters across the county. He made good on that commitment again in 2009 by launching New Planner Recruiting, dedicated to placing tomorrow’s planners within today’s firms.

So far in his career, Brown estimates he’s had more than 10,000 conversations with job-seekers, so he knows a thing or two about interviewing prospective hires. And yes, he shares his best interview questions here (see question 8). When the Journal spoke to Brown recently, we also learned his thoughts on effective internships, the differences in attributes between career changers and new grads, and the value of Kolbe tests.

1. One of your areas of expertise pertains to the hiring and successful integration of new planners into firms. What’s the No. 1 mistake you see firm owners make when bringing on a new planner?

There are a lot of them, but I’ll try to boil it down to the most common mistake I see, and that really hasn’t changed since I started my career: it’s lack of expectations or unclear expectations from the hiring firm. The supervisor expects too much too fast from new hires. There are a few things I can guarantee in financial planning, and one of them is if you don’t communicate the expectations to your new hire, they’re never going to be able to meet them. What I see a lot is expecting the new hire to approach something exactly as the boss would even though they have a different approach and much less experience.

There are other mistakes, too. Firm owners don’t hold regularly scheduled reviews to look at performance because they are “too busy,” so a lot of times the new planner can get off track and they’re thinking they’re doing really well and the firm is thinking, “Why is this person doing things this way”; “They’re not meeting my expectations”; or “I thought I told them all this in the initial interview process.” So basically, you’ve got people going in opposite directions.

Another hiring mistake is the firm or the firm owner becoming enamored with someone who is exactly like them. Red flags show up on the candidate’s skills assessments or maybe their ethics or values, and firm owners choose to ignore that and oftentimes go ahead and pull the trigger anyway because they think, “This person is just like me when I was younger.” This causes a lot of the failed hires that I see.

2. Let’s say I am a college student who will be graduating from a CFP Board registered program in 2015. What advice would you offer me today to ensure my success landing a job at a planning firm upon graduation?

Landing a job in this market, as long as the stock market doesn’t correct any time soon, is very simple. The candidates I work with are receiving multiple job offers. So getting a job is not really the challenge. Finding the right fit and succeeding in the profession—that’s a completely different story though. 

When I’m talking to candidates who are still in school, they need to prove to me and other potential employers why they are passionate about financial planning and why they have chosen this profession and are committed to it.

Then I take it further and ask, so what are you doing above and beyond obtaining an education in financial planning? Are you reading outside of your required coursework? Are you researching the issues the profession is grappling with? Are you securing additional licensure, like a Series 65? How many internships have you secured? When do you plan to take the CFP® exam? Are you going to take it right after school, or are you going to wait until you get hired? What software have you tested that maybe you haven’t used or had exposure to in your coursework? What are you doing that’s setting yourself apart from these other candidates who are going through the exact same program you are?

The best candidates and the best hires go above and beyond the minimum and demonstrate extra effort.

3. What advice do you have for firms that want to bring on an intern, but they just don’t know where to start?

First off, there are lots of resources available to them. Fox, Joss & Yankee did an internship white paper a few years ago that can be helpful, and there are lots of other firms out there doing internships successfully. FPA has some resources, and a lot of the custodians have checklists and sample job descriptions and ideas for projects interns can work on as well. We have even written a few blogs about it so they’re not starting from scratch, but firms really need to be clear on the vision of exactly what they want to get out of the internship, and what type of experience they want the intern to have.

A lot of times, firms look at this one-sided. Something to the effect of: we need to get that mountain of documents scanned, or that database of data manually transferred. Well, firms need to offer an opportunity, and interns need to add value and perform. It needs to be an interesting opportunity, because the best candidates seeking internships are not going to go to a firm that doesn’t have a compelling opportunity. Scanning documents all day is not really a compelling opportunity, but when I talk to firm owners, they all think they’re providing a compelling opportunity, so potential new hires should make sure they know exactly what they are getting in an internship and in an entry-level career position.

The bottom line is: the CFP® programs do a good job of teaching the science of financial planning, but they aren’t currently set up to teach the art. It’s up to the practitioners to teach the art in an apprenticeship model, which is where we are in financial planning. The firms that say to an intern: you come work here and we will teach you the art while you do these other tasks maybe the rest of the firm doesn’t want to do, and add value for us, those firms will continue to secure the best candidates.

4. You have mentored and coached career changers and college students. Are there differences between what career changers and new grads can bring to a financial planning firm? 

In addition to being in different stages of life and career than students, most career changers go through a CFP® certificate program, which is structured much differently than a traditional degree program. Some career changers can sit for the CFP® exam in as little as nine months, while with a degree program, it’s four or five years before you can sit for the exam. Four or five years, that’s obviously much more in-depth—I call it more full-immersion—and some firms prefer that versus someone who went through a few classes on technical topics and took the exam.

But can they bring different things? Absolutely.

New grads are usually going to have a longer work horizon. Hopefully they’ll be able to work for at least a couple of decades. They could be less expensive, salary-wise. They’re typically not established in their career, and they don’t have family to support yet, so they can usually live on less. I think, too, for firms that are really leveraging and utilizing technology, the Gen X and Gen Y types who have grown up with high-speed internet, have the devices, and tend to be a bit more technology adept [are more attractive hires].

Career changers, on the other hand though, they tend to have more life experience. They’ve bought cars, they’ve sold cars, and they’ve bought and sold houses. They’ve gotten married, gotten divorced, had kids, done all these things, and we’re in a business where clients are paying for maturity, wisdom, and advice. That’s a great benefit for someone who’s been through a lot of those things, because if you’ve been through some of that stuff, it’s a lot easier to guide and explain and give the correct advice versus if you’re newer to life and have just been reading about it. 

Just because someone is a career changer doesn’t mean this person is old either. This person could be five years out of college and was an engineer, so they’ve got some workplace experience. They’ve been in an office environment, or a corporate environment. They may have dealt with high net worth people before. So if a firm is wanting to thrust somebody into a lead client-facing [situation] on day one with little or no support (which I don’t suggest), career changers usually have a higher level of comfort in dealing with that. It doesn’t matter how sharp a 22-year-old is, if the client is four decades older, sometimes there’s a trust or experience hurdle there that can be overcome, eventually.

5. Do you feel the planning profession currently provides adequate career paths? If not, what do think the profession needs to do to improve the situation?

In the channels I work in—the independent financial planning firm, or RIA market— we are getting closer. All of the opportunities at the firms I represent are entry-level salaried positions. There’s no expectation of business development, especially initially. There’s clear progression and expectation for advancing, and that wasn’t available to me when I came out of school not that long ago. So we’ve made a lot of progress there.

It might be just a pet peeve of mine, but we need a little bit more consistency on job titles. I am not a fan of the word paraplanner, and I’m on a one-man mission to eradicate that from our professional lexicon when what we’re really talking about is an associate financial planner. “Para” implies they will never become a full-fledged planner. Think paralegal, paramedic; those people don’t usually become lawyers and doctors, so we need to start calling our new professionals what they are. 

I think it’s also a fruitless endeavor to try to come up with a standard career path and force it on hundreds of thousands of entrepreneurs out there. These entrepreneurs got into this business so they could do their own thing, so some organization or someone trying to tell them, here’s a career path, you need to implement this; I just don’t think that’s going to work well. 

Instead of wasting time and resources on that, we need to be communicating to the new entrants: you can come into the profession, and it’s going to be salaried. Here are the parameters, but you can blaze your own career path in this firm if you do this, and this, and that. It’s not going to be a cog in the wheel like it is in some other professions. In accounting, law, and medicine, it’s all planned out for you. You know what your title is going to be, you know what you’re going to make, you know what schooling you have to have, and you can’t really impact a lot of those firms or the profession like you can ours, and I think that’s a good thing.

When I say that they can create their own career path, I want to make sure we’re clear here. This is not to be confused with what certain channels used to tell recruits and still sometimes do, and that is: you’re able to work when you want to and make as much as you want to and have your own office, which really was a guise for, “Hey, go out and start getting your own clients and calling people and selling stuff.”

6. You were instrumental in creating the FPA Career Day program at the FPA of Dallas/Ft. Worth chapter, and that program has since been implemented at many other chapters around the country. What was your inspiration for creating this program, and what do you wish FPA members and chapters get out of it?

I was looking for an internship and a job in financial planning in the 2001–2002 timeframe, and it was one of the worst times to be entering the profession, to try to convince somebody to take a chance on me, hire me with a good education but virtually no experience other than a short internship, and pay me a salary without me really bringing in any revenue. 

I struggled and made some mistakes along the way and finally was able to convince somebody to take a chance on me, but I saw a lot of my colleagues coming out of these programs who could have been better planners than me, and they weren’t able to find a position. Or, they found a bad fit and dropped out of the profession because they got into a situation and said to themselves, “Well, this isn’t what I really thought financial planning was, and if this is what I’m going to have to do the rest of my career, I’m not going to do this,” and they left the profession. I knew right then that something had to be done because they were qualified, sharp, educated people who could have been great planners, and I committed myself from that point on to assisting the newer entrants into the profession.

As for what I hope FPA members and chapters get out of it, I hope they get a sense of community and connection. I think that’s what these newer planners and the recent grads want, even the career changers. And frankly, sometimes the next generation of planner is right under a firm owner’s nose and they have no idea that they’re even there. So I hope [the Career Day program] is breaking down some of the unnecessary barriers of entry into the profession and it is a great fit for a do-it-yourselfer type firm owner seeking to hire someone.

All the viable chapters I know of have held one of these, or are holding them consistently, or are in the process of putting one on.

7. There seem to be some common perceptions—or perhaps misperceptions—in our culture about members of Generation Y. In your work with Gen Y planners, what do you see as common traits?

We’re talking about roughly 80 million people in a generation, so we can’t make blanket statements, but generally they’re ambitious, they’re energetic, and they want to start contributing right away. They can get frustrated if they don’t feel like they’re in a position to be able to contribute right away or they’re being held back from contributing in a material way. I think that’s where some of the frustration can come from on both sides. 

Firm owners need to realize, though, that Gen Y simply might work differently than they do because they’re from a different generation. Unfortunately, sometimes this is just too much for firms to take, which is why they should probably hire a career changer instead.

8. Part of the service you provide through New Planner Recruiting is pre-screening candidates for your clients who are looking to hire. You also help coach your clients on interviewing candidates. What’s one or two of your favorite interview questions?

The first one is going to sound overly simplistic, but it’s asking a candidate: why are you choosing this career? And if they say, “I want to help people and I want to work with numbers,” okay then, why didn’t they choose accounting? So exploring this thoroughly upfront is key. The way a candidate answers this question tells you a lot about their awareness, initiative, and motivations, and that will provide a lot of insight into how they will perform in the role that the firm is hiring for. 

The bottom line here is that candidates who have the most genuine story to why they selected this major, why they chose this field, and why this is the right career for them are the ones who do the best in the profession.

Another question I like to ask is one that I got from George Kinder in his life planning program: what would your life look like right now if you won the lottery and you had $10 million deposited in your bank account overnight? The way a candidate answers this will tell you a great deal about the person’s work ethic and motivation.

9. You are also a Kolbe Certified™ Consultant. Do you incorporate Kolbe tests into your recruiting work? If so, what do hiring firms and job seekers gain from that?

I actually require both the firms and the candidates go through the Kolbe process. I’m a believer in the Kolbe methodology because it measures a part of the mind that people aren’t as familiar with as they are the cognitive intelligence and the affective, which is your personality. To effectively screen a candidate, the screening process must measure not just one or two areas of the mind, but all three: the conative, the affective, and the cognitive.

The conative is really measuring how this person will do something, not how they think or feel, or how they’re motivated, although you need to know all that too, because that’s important. So hiring firms will know exactly how a potential candidate will instinctively do a job, and then we can take that data, match that up, and score it against what job the firm needs done to see if there’s a good conative fit. Everybody can adapt and adjust, but why do that? If you’re constantly swimming upstream, you’re expending all of your mental energy, you’re going to spin your wheels, and you’re not going to be operating at your best. 

And job seekers will have a better understanding of why they do things the way they do. For example, why they prefer to gather a lot of data, or ask a lot of questions, or maybe for someone, why they prefer to make snap-judgment decisions. It’s understanding instinctively, innately, why they do those types of things.

10. You are a former president and chairman of NexGen, FPA’s community for planners age 36 and younger. What did you gain from that experience, and what would you consider your biggest accomplishment during your time in NexGen leadership?

It was a phenomenal experience, and I’ve gotten so much more out of it than I could have ever put in. It’s a great platform to hone leadership, listening, conflict resolution, and delegation skills, and that helps me every day as the CEO of New Planner Recruiting. It’s helped us grow the firm to where it is today.

I also gained even more respect for the NexGen planner community. Frankly, I’m just in awe of our membership and in my cohorts who are out there every day, sometimes in not very pleasant circumstances, providing great advice to the American public and adding value to their firms.

I feel very fortunate that this group will, and is starting to in some cases, take over for the founding generation. There are a lot of good leaders in that group, and I’m really looking forward to watching what happens and what they do in the next few years and who rises to the top. [Through NexGen] you get to be around so many people who are passionate, so many people who want to move and shake and shape the profession.

And as I mentioned earlier, in some other industries and professions, you can’t have an impact; you can’t change anything because it’s been around forever. And this is the type of stuff we need to be telling people in high school and early on in college: you pick this field and you can have a material impact on shaping the profession—that is compelling!

As far as initiatives, we worked on a number of things and I’m proud of them all, but the one that sticks out the most is the local NexGen chapters and the local NexGen chapter liaison board positions we established.

NexGen went from several hundred members to several thousand overnight when FPA national started to auto-enroll everyone under the age criteria who joined FPA. I was committed to trying to keep the same level of connection and intimacy that I experienced when NexGen was just getting off the ground early last decade—I had a network of a few dozen people who I could go to and seek advice from who had a substantial impact on my career and helped me get to where I am today.

So we reached out to local FPA chapters to help facilitate connecting [young planners] at the local level instead of only at the national level, which was the national message board and an annual conference. When we started, it was maybe a dozen local chapters, and last I heard there was about 40, so we’ve made a lot of good progress. Andrew Sivertsen and Jennifer Quigley, who served directly after my leadership tenure, deserve a lot of credit for this as well because they continue to build on what we’d already started.

Carly Schulaka is editor of the Journal. Email author HERE.

Learn More

Join Caleb Brown at 3 p.m. eastern on April 8, 2015 for the FPA Business Success Knowledge Circle call, where he will present “Practical Tips on Sourcing, Screening, and Integrating Top New Planners into Your Firm.” FPA members, click HERE for details.

Practice Management