The top 5 risks you face when forming your own team of financial advisors, along with insights on how to manage each one
Income Instability During Transition
When you move from being a personal producer to a manager, your income shifts from individual commissions to team overrides and bonuses.
For the first year or two, this often means lower and more unpredictable income.
Example: You’ll spend more time recruiting, training, and mentoring, time that used to be spent selling.
If your recruits are not yet producing, you’ll feel the income gap.
How to manage it:
Maintain a small personal production base while your team matures. Build a 6–12 month financial buffer to cover personal expenses.
Recruitment and Retention Challenges
Finding the right people is difficult; keeping them is harder.
Many new advisors drop out within the first year due to slow results, lack of discipline, or mismatched expectations.
Risk: High attrition means wasted time and training cost. It can also demoralize the leader.
How to manage it:
Recruit for values and attitude, not just sales potential. Create a culture of mentorship, recognition, and consistent activity monitoring. Remember what Ben Feldman said:
“If you’re not teaching your people, someone else will.”
Leadership Burnout
Management requires emotional stamina.
You’ll juggle personalities, egos, and constant motivation duties, while handling your own production targets.
Without boundaries, burnout is real.
Risk: You may lose enthusiasm or become detached from both leadership and sales.
How to manage it:
Develop a structured coaching system instead of managing by reaction. Delegate early to senior members. Prioritize self-care and personal learning to stay inspired.
Compliance and Reputation Risks
As a unit head, you become responsible not only for your own sales practices but also for your team’s conduct.
Any mis-selling, misrepresentation, or regulatory violation by a team member can reflect on your leadership record.
How to manage it:
Set clear ethical standards. Conduct regular compliance refreshers. Require all advisors to adhere to documentation and suitability processes.
Remember, your reputation becomes your agency’s brand.
Cultural and People Misalignment
One of the hardest risks is mismatch of values and vision.
Not every good salesperson fits your culture, and not every ambitious person wants to follow your style. If your leadership philosophy isn’t clear, confusion and conflict will arise.
How to manage it:
Define your team culture early, what you stand for, what behaviors you reward, and how success is defined.
As Simon Sinek said:
“Customers will never love a company until the employees love it first.”
In your case: Your team won’t believe in your mission until they feel you genuinely believe in them.
Final Reflection
- Building your own team is both a risk and a reward.
- You trade short-term certainty for long-term legacy.
- The key is preparation, financial, emotional, and managerial.
- When done right, it’s not just a promotion, it’s a transformation from achiever to builder.
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