Design to Double: How to Properly Grow a 401k Business

401k, practice management, growth, retirement, sales
Infrastructure comes first.

“I want to double my practice in three to five years.”

It’s something many advisors, including myself, often say. While it’s a common goal, few achieve it consistently. During my 29-year career as an advisor (and still in production), my practice has doubled a few times. However, my last “double” was many years ago.

Remember what your practice looked like when revenue was half of your current production? Think about it. I did, and it was an epiphany.

And if I want to double my production in the near-future, I must recognize that my practice needs to look and feel differently than it does today.

Ask an advisor what it takes to double their practice. You’ll hear a common theme, something like, “I need more staff and more money.” That’s partly true, but it misses the point. It’s not just doing more of what I’m doing now. To double my practice, it must be different by design.

If I am going to “Design to Double,” which is a theme in my practice, I need to envision what double looks like. Consider important metrics and ask yourself how it would look.

For example, if I have 40 plans now and want 80, what would change? It means 40 more annual plan reviews (APRs). How long does it take to prepare, arrange, and deliver one APR? Can my team and I handle 40 more, or twice as many in this example? Not the way we currently do things.

What if most of those clients need additional investment committee meetings? How many hours are required to prep, deliver, and follow up on those meetings? I can’t even count that high.

How about inbound phone calls? How many does your office receive daily? Ask the person who answers the phone. Here’s my guess: the number your office receives is at least double what you think. Then, ask whoever answers the phone if they could handle twice as many inbound calls starting next week. The look on their face will speak volumes.

Why isn’t my practice twice the size it is today? Easy question to answer; it’s not built for twice the amount of revenue. My current level of production is the product of my design. I must own that. If I want to double, then I must figure out what to do differently.

To envision my future practice, I must think more like a CEO and less like a 401k advisor. I need an improved business model that can handle twice as many plans, APRs, inbound phone calls, and a host of other activities. If this is your goal as well, then the Design to Double articles will help.

During meetings, we discuss what double will look like on a regular basis. It’s a great mindset and foundation for conversations. But where do you start on your journey to double? I’ve found three areas to be most impactful, and that’s where you should focus your efforts.

  • Personal productivity,
  • practice management, and
  • leveraging partners.

Those are areas you can control, and each must be addressed to design a practice that can double. It’s more than just a mindset; it’s a movement. Think like a CEO and control what you can. The future of our industry belongs to the advisors who can do this.

Each article on this topic article will be a collaboration of top advisors and experts. Some of the discussions will continue at Excel 401(k): The Advisors’ Conference in Las Vegas.

Ready to join the discussion? Send an email to ross@rekonintel.com to suggest topics and ask questions. Would you like to contribute? Let me know.

Ross Marino, CFP, CPFA, CeFT, contributing editor to 401(k) Specialist, is the founder and CEO of 401(k) Rekon | Excel 401(k). He can be reached at rmarino@rekonintel.com.

John Sullivan
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With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.

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