“One question: what is your why for scaling?”
A colleague with a planning practice in Arizona asked me this over the weekend. I answered, but it left me ruminating on the question. Plenty of growth in the world of finance is growth for growth’s sake. Those who’ve made a thorough study of finance and inflation understand that no growth is actually negative growth, so some nominal growth is necessary to continue. Plenty of financial planning firms simply grow by virtue of the market’s growth, rather than serving more clients, after all! But the question is more fair than it ever has been, as the firm passes the “million dollars of recurring revenue” benchmark with 197 client households and small businesses to serve.
The truth of the matter is that the practice bypassed the “capacity crossroads” earlier this year, but it’s faced with a new phase of growth already. So this week, as I sit aboard a flight to Las Vegas to speak at the 2025 Financial Planning Association’s Annual Conference, I thought I’d reflect on how that growth is going and what it means for my “why.”
The Original Plan for 2025 and Beyond
Coming into this year, we had a team of myself and two associate planners, plus an intention to hire a new financial planning assistant to support our operations side early in the year. We made the hire and spent a good portion of this year simply growing, bringing on 15 new households year to date, with a focus on our associate planners being their primary relationship point of contact with the firm, rather than taking on primary responsibility myself. We then had some unplanned turnover in Q3, with our assistant departing and being replaced by our presently fantastic new wealth planning assistant, and on the line between Q3 and Q4, seeing one of our associates depart for another opportunity.
One major point of growth that we had going for us coming into this year is that with two associate wealth planners on the team, even at 180 or so households to start the year, we had bandwidth to increase our client roster by about another 100-120 before we would need to staff up the planning side of the practice again. However, with the turnover of a 2-year associate, we find ourselves suddenly both with a lot less room to grow into, but also in need to start developing the next wave of talent much earlier, as what was previously going to sustain for another 2-4 years suddenly is unlikely to be adequate for more than another year or so before we find ourselves strained by limited capacity. So, we began hiring for two wealth planning analyst positions last week and, as of this writing, have received 110 applications!
While we entered this year with an intent that our next hire after the planning assistant would be a marketing specialist so we could accelerate the 2-4 year timeline and better use the bandwidth available to us, we find our next year’s team growth plan dominated by the obligation to train two new wealth planning analysts on their own journey to become full CFP® Professionals. Strangely then, while the firm has grown hundreds of thousands in annualized revenue this year, the team seems to experience a peculiar experience of growing at the same time as feeling like we’re spinning our wheels a bit! And of course, none of these answers the question of why, but it all feels like important context.
A Detour Into the Context
For those who don’t work in the financial planning world, let me share an observation: The vast majority of financial planning or financial advisory firms fall onto either side of a barbell distribution of services and service models. In the independent fee-only universe, the “lifestyle” practice in which a financial planner serves 40-50 great clients and makes a terrific living dominates the landscape. In the corporate and institutional wirehouse and insurance world, it is normal for advisors to boast of having several hundred “clients” each, albeit their relationships might be more akin to a butcher having several hundred customers who come through the shop occasionally, rather than ongoing, dedicated, fiduciary, comprehensive financial planning relationships. But I digress.
The relevance of this is found then in MY Wealth Planners’ exception to this rule. I could close the Longmont office, fire 75% of our clients, and make about twice what I take home currently by running a lifestyle practice while working half as much! In turn, while we serve almost two hundred households currently, much of the revenue from those households goes to support the staff presently on the team and joining the team soon, but also supports the necessary infrastructure and technology to have such a team on staff, rather than running a lifestyle practice from my home office.
Essentially, the decision to scale itself is peculiar in my role. Not just because we claim the title of Longmont’s first fee-only financial planning firm and Certified B Corp, but because most firms either serve a lot fewer people to make better money, or serve a substantially larger number of people by holding onto their money and doing little else, supported largely be an institutional back office somewhere that does all the actual day to day work of delivering on financial services.
So, What is the Why?
Simply put, I believe financial planning does wonderful things for most of the people who partake in such services, and I’m deeply bothered by the fact that such services are essentially a luxury good. I come from a middle-class family. My parents both made careers in law enforcement at the local level. Most of my grandparents were teachers, and essentially, my entire family has made a career of public service in one way or another. All of that is laudable, but it’s relevant to this discussion because, essentially, no one in my family, until this present generation, has ever been in an occupation, had an income, or had the means to warrant the services of a fiduciary financial planner. We have all been served by bank tellers, loan officers, and insurance agents in one way or another, and we’ve all gotten by on that for the most part.
But there’s an old expression: Familiarity breeds contempt. Knowing what I know now about the financial services industry, I cannot even begin to measure or fathom how much wealth has been lost in my family due to relying on transactional salespeople as our financial support providers, rather than working with fiduciaries with a duty to serve our best interest. Almost a decade ago, the Department of Labor estimated that conflicted financial advice was costing Americans as much as $18 billion annually.
So how does a problem turn into a why? The problem of fiduciary financial advice being a luxury good isn’t on a trajectory to get better. Despite the fact that there are now several hundred certifying educational programs for financial planners around the country, we are expected to be 100,000 financial planners short of demand in the United States by 2033, based on simple population growth. This is caused both by the fact that the average financial planner is in their late 50s, thus leading into a retirement wave that’s already been hitting the industry for the better part of the past few years, but also by the fact that the industry-wide survival rate is only 30% in the first 5 years, which is magnified by a 13% survival rate in the firms with the highest annual hiring rate.
The problem is that, in an industry whose supply will be shrinking relative to demand, market forces will essentially command that service costs increase rather than decrease or remain level, relatively speaking. While some might rush to point out that tools like AI LLMs are already being used to create advice platforms for consumers, the same sorts of observations were made about robo advisors a decade ago, DIY discount brokerage trading websites the decade before that, personal computers with access to the nascent internet before that, and so on and so forth back to the dawn of financial literacy and financial products.
Financial planning is currently a luxury good, and based on all available evidence, that problem is likely to get worse before it gets better. But I want to see the world be a better place. I’ve had the privilege over the past decade of seeing people’s eyes light up as they realize they can finally retire. I’ve been blessed to be consulted on decisions ranging from the mundane to the life-changing. I’ve had people tell me they were expecting children before they’d told their families. I’ve been the first phone call when a parent has passed away. And in all of that, I’ve had the true honor of a front row seat to some of the most important and meaningful decisions and events in hundreds of people’s lives. I said earlier that I believe financial planning does wonderful things for most of the people who partake in such services. And I want that to be something more than just the wealthy can enjoy.
What Gets in the Way of Why
Ironically, among my financial planning colleagues, I’m a bit of a “raise your fees” fairy. Problems in your practice? Wave of the wand, *ding*, and by the raising of your fees, your problems are solved. Seems a bit contradictory to my why, no? Well, not really. You see, the people I consider my colleagues in financial planning are the self-sacrificing sort. Whether they plan to run a firm that grows and scales or just a lifestyle practice, many of us do the disservice of being simultaneously under-promise-over-deliver types while also undercharging for the service.
An annual study of fee-only financial planners by XY Planning Network has now found for several years in a row that 100% of new fee-only financial planning firms raise their prices in the first 3 years. So with that in mind, swish-and-flick, I encourage my colleagues to raise their prices. Not to take advantage of the market for luxury services, but because the big guys never blinked at overcharging their clients. While the fees from wirehouses and mega-firms often look approximately equal on paper, e.g., “We charge 1% of your assets under management” being a common refrain in PR-articles and sales literature, most mega firms are engaging in both the sale of advisory services and financial products; and when they’re not selling the products to you directly, they’re being paid by the product-makers to recommend their products in their advisory programs. We’ve covered this in great detail before.
So I recommend that my colleagues raise their fees. Not because I want them to make more money for the sake of making more money or just because the market will let them do it. But because self-sacrificing themselves financially means they will not grow, and if they do not grow they cannot scale, and if they cannot scale they cannot hire, and if they cannot hire then all the more bright young minds and career changers trying to get into this profession will find themselves selling whole life insurance to their former colleague roommates with no spouses, children, or dependents, just so they can hit their quota and try to stay in the business long enough not to wash out like the other 87%.
And So There Is My Why
Before founding MY Wealth Planners in Longmont, there were over a hundred places you could buy financial products. Note, I don’t say “get financial planning.” I say “buy financial products.” You could buy insurance or invest in funds, or get someone to trade stocks and bonds for you on a per-trade commission basis. Some firms would offer financial planning, but as a giveaway or an “extra” if you had a few hundred thousand or a million to invest in an ongoing investment management program, and funny how they all said they couldn’t really talk about estates or taxes.
I’m scaling MY Wealth Planners because I want affordable access to something like fee-only financial planning to be possible in a community like Longmont. I’m raising our minimum fees every year not to squeeze more revenue out of clients (we haven’t raised a fee on an existing client since the beginning of 2024), but to make it affordable to hire two planning analysts in 2026 and to keep growing the practice to keep doing more of that as time goes on.
When I answered my colleague’s question more succinctly than I have here earlier, she had a follow-on question, and I had a follow-on answer:
Her: “So your end game is to create enough competition to drive down the price of your offering? Or to create a scalable environment where everybody can do the same? That’s such a hard problem and I have to be honest that I’ve given up trying to solve it. God knows in my early days I was going to get it done.”
Me: “I won’t live long enough or scale enough in the lifetime of my career to have that result. But I can do my part to create high-quality opportunities for anyone on the right path to get into the profession and make a difference toward that impact.”
So there we are. We came into 2025 expecting that we’d hire a marketing specialist to help us expand to fill our ample bandwidth. We march toward 2026 now expecting that we’ll have to rebuild that bandwidth over the next year before that next hire and endeavor make sense. But when I was in the Army, I was taught that no matter how good your plan was, if you fought long enough, there would be casualties. While casualties is a bit strong a word for something like business, I accept it as a reality that there will be some steps back as long as we’re striving to step forward.
So I continue to live, day by day, in the pursuit of my why. To make the lives of others a genuinely better place, whether by my direct help or by the help of someone given the opportunity to do so by an opportunity I’ve helped make possible. And if you’ve read all the way to this point: Thanks for being with me on the journey. You’ve helped make it possible for me, too.