2023 Employee Benefits Guide

Daniel YergerAbout the Firm Leave a Comment

Hello everyone! In the spirit of transparency and building in public, we’ve always made a best effort to share our own compensation and benefits model with you as our clients and community. It seems only fair as people who talk to our clients about their money that we talk about our own money. So, today I’m sharing our updated employee benefits and compensation guide, as well as discussing the thinking and philosophy about those changes. A question might arise: “It’s June, why the sudden change?” Simply put, our insurance renews on June 1st, so that makes it an optimal time to go through benefits changes and updates. Some of the changes are innocuous and administrative, others are material and significant. We’ve also developed a basic text outline of the “Career Path” for financial planners to better help new team members understand how their careers will progress with the firm. So here they are, and let’s talk about it.

Download the 2023 MY Wealth Planners Employee Benefits Guide

Download The Path to Becoming a Wealth Planner

Employee Pay Scales

We updated employee pay scales to align with changes to the career path progression at the firm. The pay levels themselves did not change for the year, other than the inflation adjustments made in January. We also expanded our pay scales to a full page and 30 years of experience to align with the Sabbatical program’s timeline, and to allow for more clarity for experienced hires. However, as we’ll discuss in a bit, we made adjustments to the qualifications and timeline for the associate planner and lead wealth planner positions. This resulted in me personally not receiving a raise at my experience anniversary this year. Fair’s fair, as they say.

Individual Bonuses

Our bonus structure hasn’t changed, but for those who didn’t know, the before and after is that any licensed team member who sources and onboards a new client receives a bonus equal to 50% of the fees paid by that client in the first year of services. This was always designed to incentivize building relationships in our community and bringing on new clients that we could help with wealth planning. However,  our original vision of this was that it was a team effort, and thus, significant attention was paid to how the earner of the bonus might elect to divvy up the bonus to their team members. This felt overly complicated but also created some incentive misalignments in other areas of the guide, which we’ll discuss further on.

Benefits Eligibility

At the launch of the firm, all benefits triggered immediately upon hire. While philosophically I still agree with this, another area of our firm’s mission comes into conflict with this: Paid interns. Ironically, having unpaid interns means that the unpaid interns are not technically employees and they therefore are not eligible for benefits. But we don’t believe in asking people to work without pay, and so we pay all of our interns. This creates a problem: they become eligible for benefits just like any other employee. While this doesn’t seem like a big deal at face value, the problem is that the typical salary and taxes budget for an intern that we’ve had over the years has been around $3,000/month. Adding benefits onto this adds about another $1,500 to the internship’s monthly cost, which while manageable, isn’t really ideal when the intent is to give these students a few months of experience. The result of all of this is that we’ve decided to move benefits eligibility back to 90 days to avoid overlap with the intern program; we don’t like it, but it ultimately became the “lesser of two evils” from a benefits management standpoint.

Health Insurance

Traditionally the base plan in our benefits package has been a platinum-tier ACA plan, with an optional gold-tier HSA-eligible high-deductible healthcare plan. However, what this has caused is that there’s essentially no adoption of the HSA plan because the deductible difference between the platinum and the gold plan is large enough that the tax benefit of using HSA savings is less than the deductible difference. In order to encourage our team to “think like a CFP®” and really weigh the pros and cons, we’ve adjusted the plan to offer two gold-tier ACA plans, one that is HSA-eligible and one that is not. We still cover the full cost of the plan either way.

Paternity & Maternity Leave & Family Medical Leave

With the advent of the Colorado FAMLI program taking effect on 1/1/2024, and no members of MY Wealth Planners’ team expecting in 2023, we adjusted our paternity and maternity leave program to align with the FAMLI program. This isn’t a reduction in benefits, it simply allows FAMLI to function appropriately in alignment with what MY Wealth Planners provides.

Career Path & Promotion Qualifications

Succinctly, we’ve made the decision that the associate planner role is no longer technically an entry-level position and requires one year of experience and that the lead wealth planner role requires six rather than five years of experience. There’s a lot of information on what’s expected of each role in The Path to Becoming a Wealth Planner, so I want to talk about why we made the changes.

The decision to move the associate planner to a one-year experience requirement is simply the issue of overload. In discussion with Samantha and reviewing her experience as an associate planner, the issue arose that she was very overwhelmed between getting her Series 65 license, studying for the CFP® Exam, learning all the different systems and software that we use, and so on. It’s also noteworthy that as the only full-time non-owner staff member of the firm, her responsibilities have regularly bounced between that of an unlicensed assistant and that of an associate planner. Given that consideration and how much is front-loaded into the existing paradigm, we decided that it would be better to require a year of experience for the associate planner position, reflecting that candidates already have several internships or otherwise have already completed their Series 65/66 and worked with another firm for a time; or that they will spend the first year of their time with MY Wealth Planners working on mastering the systems and processes of the firm before advancing to earning their Series 65 license and beginning to work more as an associate planner of the firm.

The lead wealth planner was moved back to six years for a similar reason. At inception, the progression of a team member from associate to lead wealth planner involved earning the Series 65, completing the CFP® Exam, completing a master’s degree, earning two professional designations in addition to the CFP® Certification, and attaining responsibility for at least eighty client households. Suffice it to say: It was a lot. Shifting the earliest eligibility out for another year gives future team members a bit more breathing room as they work on accomplishing their educational and client development requirements, and moves the “anchor” on progression to a more reasonable place. Another element of this is capping the lead wealth planner at no more than 100 clients, which is only 20 more than their requirement of 80 to become a lead wealth planner. The purpose of this is to align with the individual bonus adjustments and, more importantly, to ensure that lead wealth planners don’t simply “horde” client relationships. A key value of MY Wealth Planners is selfless service, and part of that means sharing opportunities to work with clients with more junior team members, and helping them build their experience with clients.

Intended Outcomes

Ultimately, as a firm, we aim to be a firm that isn’t built around wealth maximization for the owner or the staff members. The career track and progression are built around a philosophy of developing mastery of financial planning over several years, followed by then turning to mentoring and supporting the next generation of financial planners. I have no doubt that what we’ll see over the years is that many of those on the path leave to start their own firms, and I celebrate the entrepreneurial spirit in those team members. Others, those that stay, I think will do so because they want to help nurture and develop their junior peers and want to give back to the profession and their community, much as I have done and continue to do. Life takes us all to different places and we all find meaning in different ways; it’s one of the things that’s special about being human!

That said, I hope you’ve enjoyed reviewing what we’ve created here, and I look forward to sharing the update of our benefits and compensation with you again next year!

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