Is Partnering with a Virtual Support Provider Right for Your Firm?

Martin Baker, CFP®
Martin Baker, CFP®

02.14.24 in Wealth Planning & Investing

Estimated Reading Time: 7 Minutes (1224 words)

Virtual Service Provider Image

Growing advisory firms can expand their capacity, fill a skills gap, and scale their business by using the services of a virtual support provider or an outsourced administrative partner. Virtual administrators and paraplanners can provide timely relief and free up advisors to focus on what they do best: building and deepening client relationships. Would such an arrangement make sense for your firm? Here, my colleague KC Olsen and I walk you through the responsibilities virtual support providers offer, plus outline what to look for in a partner and how to manage the partnership.

What Do Virtual Support Providers Do for Advisory Firms?

Fully trained and experienced, virtual or outsourced specialists are matched with an advisory firm to support financial advisors and their clients. It’s a cost-effective alternative to hiring and onboarding full-time staff. In turn, you’ll be able to scale your firm’s capabilities and skill sets. For a firm in growth mode that isn’t ready to commit to more staff, this means it won’t have to take on the cost of salaries, benefits, and resources involved in onboarding, training, and certifying.

Consider the different roles you could have access to:

Virtual admins. These individuals are dedicated to your firm for a certain amount of time (e.g., 8–24 hours) per week. They seamlessly become a member of your team, working alongside your staff and interacting with clients when appropriate.

Responsibilities vary and can include making calls and sending emails, scheduling meetings, preparing paperwork, opening new accounts, entering client notes, and helping with billing, CRM support, and data entry. The virtual admin will use your systems so that outside interactions appear as though they are just another member of your team.

Commonwealth has recently developed several virtual admin-style programs for our affiliated advisors. In our VA Classic program, a dedicated operations professional works with their firm part-time for six months or longer. A new option, VA OnDemand, provides advisors dealing with an unforeseen event or in a time crunch with a pooled team of operations professionals.

Virtual paraplanners. Similar to virtual admins in the sense that they become an important part of a firm’s team, virtual paraplanners have specific responsibilities. They assist the advisor in preparing financial plans while expanding the firm’s financial planning capacity and the number of clients an advisor can take on.

These planners are highly trained and credentialed and know how to use a variety of planning software to develop a customized, comprehensive plan that incorporates the advisor’s planning process and modeling preferences.

Danette Lowe, CFP®, founder of TruNorth Wealth Management, has used Commonwealth’s Virtual Paraplanning Program (VPP) to gain more time to spend with clients. “Out of the five plans they’ve curated so far, each one has culminated in clients seeking additional services, such as life insurance with long-term care. I cannot commend the paraplanners enough for their stellar work,” Lowe said. “Their expertise has not only saved me time but also enhanced the value I provide to my clients.”

They allow our most senior people to spend more time on analyzing client situations and presenting comprehensive plans to clients and prospects.
Jessica Blood, CFP®, Founder and CEO, PlanWise Financial Group­on using virtual paraplanners

Is Partnering with a Virtual Service Provider Right for You?

If you’ve contemplated outsourcing to a virtual team, the answer may depend on whether you’re facing a short-term or long-term staffing issue.

  • If your team is stretched thin, experiencing a continuity event, or needs to build capacity, a virtual partnership could offer support at a key time. You could revisit the strategy six months to a year from now.

  • If you see an opportunity to take some administrative tasks off a staff member’s plate to give them new responsibilities or expand their role, virtual admins could provide them with the breathing room needed to try new things.

  • If you want to convert to new planning software programs, a virtual planner could introduce these to you or the team.

  • If your firm is winding down, virtual admins can get your books in order.

  • If your firm uses a technology platform not commonly supported by virtual service providers, you may find that bringing in a full-timer is a better option than outsourcing.

What to Look for in a Virtual Support Provider

Each firm’s scope of work will vary, as will the virtual provider’s capabilities. Remember to keep these factors in mind when doing your research:

Industry focused. A virtual admin who doesn’t specialize in the work of advisors would require significant training. So, inquire about training and certifying the experts you are bringing in. For instance, Commonwealth virtual admins complete an eight-week immersive training program. “Access to part-time help, along with the ease of not having to provide training, significantly impacts our ability to grow our business,” said Carrie Coghill, CFP®, AIF®, president and CEO at Coghill Investment Strategies, who uses Commonwealth’s VA Classic program.

Reliability and experience. How seamlessly can this individual or virtual team become a part of yours? Inquire about onboarding timelines and how the virtual admins or paraplanners prepare to help your firm. For instance, what certifications do the paraplanners have (e.g., CFP®, CPWA®, and ChFC® designations)?

Customization. Anyone working on behalf of your firm should adjust to your way of doing business. For example, this could include representing your brand in a client phone call or, for a paraplanner, adjusting recommendations based on the strategies of your firm and the circumstances of each client.

Compliance and security. You’ll want to confirm that your service provider follows the same protocols as your firm, including background checks. How does their employment work with your service provider (e.g., Commonwealth’s virtual admins and paraplanners are full-time, vetted firm employees)?

Consistency. Will the specialists stay with your firm for a certain amount of time, or will you have to frequently get different people up to speed on your firm’s ways? Ideally, their tenure will be long enough (at least six months) so they understand your firm’s unique procedures and develop trust with you, your clients, and your staff.

Performance management. The service provider should handle the management of their employees, further saving your firm time. You’ll want to understand to what extent your provider will fill this role, as you don’t want the partnership to lead to more work for you. “The VA team serves as extra hands, providing essential support without burdening us with HR or morale concerns,” said Michael Paris, AIF®, CPFA®, of Paris International. “In addition, their system of backup ensures seamless operations even when they are temporarily unavailable.”

Onboarding and Managing Virtual Support Teams

While the service provider will ideally handle the human resources and performance side of your virtual support team, you will need to spend some time helping them understand your firm and how you operate. You’ll want to be prepared to explain your business, including what you need to get done and why. You could offer a list of talking points so they get to know your brand, as they will be representing your firm. You’ll also want to set aside time for regular check-ins.

Saving Time and Supporting the Firm’s Success

Considering whether to bring in outside support comes down to understanding if this arrangement can make your operations more efficient or help you grow the business. Partnering with a virtual support provider can make sense for easing the workload, filling a gap, improving customer service, gaining access to a particular expertise, or expanding capacity.

For more on how Commonwealth can put time back into your day, check out our in-house and curated business services.

This material is for educational purposes only and is not intended to provide specific advice.

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