Good judgment comes from experience. And experience comes from bad judgment.
Nobody likes making mistakes. Yet missteps are essential because we can learn as much from our failures as we can our successes — maybe more. Lessons learned from our mistakes can also be a powerful gift if we are willing to share them with the next generation of financial advisors.
It’s the perfect example of paying it forward.
When you pay it forward, you respond to the kindness someone has shown you by doing something helpful for someone else. In our business, paying it forward involves senior advisors passing on the skills and expertise they acquired from the school of hard knocks
There are several practical benefits to this practice for both the up-and-coming financial advisor as well as the veteran serving as a mentor.
For starters, I write a lot on this blog about the vital importance of doing everything you can to free yourself from getting bogged down performing mundane tasks, thus enabling you to spend more time with your clients. If you’re a young financial advisor looking to make a name for yourself, you’re probably comfortable using the newest technology. And that’s great!
However, having a seasoned mentor with a longer view can play an important role in helping you strike the right balance between relying too heavily on the latest software and not having the right type of information you need at your fingertips. A more experienced pro can show you how to use that information to your advantage with your customer base and can even pinpoint which data is best for which type of client. (A young family looking to finance their child’s education as opposed to an older person interested in preserving the retirement nest egg they’ve accumulated.)
Here’s something else to consider: veteran advisers have seen it all over the years. They’ve watched bull markets stampede in and they’ve seen bear markets awaken from long hibernations. So, they’re well-versed in handling the different human emotions that come into play during each market phase. Imagine how much insight you can gain by learning from them.
On top of that, it’s great knowing someone has your back when the going gets rough. Having a seasoned colleague with a deep understanding of your business—and your role in it—is incredibly reassuring.
If you are in the position to mentor a new financial advisor, I recommend that jump on that opportunity. I know what you’re going to say: I’m too busy. I don’t have time to spare for showing some newbie the ropes.
I get that. But consider this: How much time would you have to spend cleaning up after mistakes that your mentoring might have prevented in the first place? Remember that old saying, an ounce of prevention is worth a pound of cure. Helping an overly eager recruit learn when to tap the brakes can spare you costly headaches. Spending a small amount of time coaching and providing direction on the front end could save you untold hours doing damage control on the back end.
There is also your business’s bottom line to think about. This is especially true for smaller-mom-and-pop firms. When a team member performs better, the firm does better, too. Certainly, that makes serving as a professional role model a wise use of your limited time.
Finally, there is one intangible benefit to consider. Being a mentor is an important way to create a legacy that endure long after you retire.
Let’s face it: While a college education can prepare you to work in the financial services sector, that sheepskin only gets you in the door. There is a very steep learning curve ahead once you have secured a position. A smart advisor who is just starting will take advantage of every opportunity available to acquire the skills necessary to advance their career. And having a mentor is perhaps the most beneficial growth opportunity of all.