First-ever survey of college administrators
reveals that growing next-gen talent pipeline means increasing
awareness about financial planning as a profession
Independent registered investment advisors (RIAs) are largely
invisible on campus, which is keeping them from hiring top talent,
according to college administrators of undergraduate financial
planning programs surveyed on behalf of TD Ameritrade
Institutional1. These program directors say resolving the pending
RIA talent shortage starts with grassroots awareness efforts aimed
at recruiting more students, particularly women and minorities,
into the industry.
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For the RIA industry's first-ever survey of financial planning
program directors, TD Ameritrade reached out to all of the 105
four-year colleges and universities with CFP-Board listed
undergraduate financial planning programs in the United States2.
The findings were released today at TD Ameritrade's Advocacy
Leadership Summit in Washington, D.C., an event that brings
together the RIA industry's leading advocates and stakeholders to
discuss regulatory and sustainability issues facing RIAs.
According to the 2017 Financial Planning Program Directors
Survey, 90 percent of schools surveyed that have financial planning
programs expect enrollment in these programs to grow over the next
five years. Though minorities and women are currently
underrepresented in these programs, program directors believe their
ranks will increase as well. Currently, just 36 percent of
financial planning students are women, and even fewer - 31 percent
- are minorities.
According to reports from the U.S. Census Bureau and the
National Center for Education Statistics, women account for 56
percent of college undergraduates3 and 51 percent of the U.S.
population4. Minorities comprise 37 percent of undergraduates3 and
23 percent of the population4.
"The war for talent starts at the undergraduate level. To win,
RIAs need to get out in front of the next generation on campus and
make themselves seen," said Kate Healy, managing director,
Generation Next, TD Ameritrade Institutional. "If RIAs aren't
having conversations about the benefits of their chosen career
path, the competition most certainly will."
Cultivating Diverse Next Gen Talent
The lack of RIA visibility and voice on campus can impact the
career choices of women and minorities. Program directors say the
main reason there are not more women or minorities in financial
planning programs is because these groups are less likely to
believe the profession is a viable career option.
Those who do enroll find they are in high demand in the job
market. The survey found that despite their lower rates of
enrollment, women and minorities receive job offers upon college
graduation at slightly higher rates than the overall population of
financial planning graduates.
The program directors reported that for women, the perception
that financial planning only involves commissions and
commissions-based salaries is a key deterrent. For minority
students, the absence of minorities among industry leadership sends
a strong signal that the profession is not open to them.
RIAs can begin to change these perceptions by connecting with
the next generation in ways that resonate with their priorities,
said Healy.
Though making money is a top priority for all students, the
survey found that the number one reason women and minorities study
financial planning is to help others reach financial goals. Program
directors reported that work/life balance is also very important to
women, and minorities are drawn to the appeal of starting and
owning a business someday.
"To change the face of the next generation of planners, RIAs
need to start a dialogue," said Healy. "I'm convinced that the more
students hear from advisors they can relate to, and learn more
about the career opportunities offered by independent RIA firms,
the more they'll be attracted to the profession."
Bringing the RIA Channel to Life
Though the RIA channel is discussed within the context of the
financial planning curriculum, program directors say that
independent advisors can help their cause by increasing their
engagement with students.
The most effective thing RIAs can do to increase awareness and
build their talent pipeline is hire more interns, program directors
say. More RIAs should participate in on-campus career days and
become guest lecturers, or even adjunct professors.
Seventy percent of programs surveyed currently teach students
about RIAs, largely by bringing in advisors as guest lecturers and
by talking about the independent RIAs as a channel option.
Fifty-four percent of the schools have an on-campus student chapter
of a trade organization, typically the Financial Planning
Association. Close to 80 percent of schools offer networking events
for financial planning students.
Many college program directors get involved personally as
recruiters, actively encouraging students to consider financial
planning careers. More than half of the students in financial
planning programs come in as juniors or seniors, most commonly
switching out of finance, accounting or economics majors.
Financial planning as an undergraduate degree is still fairly
young at most colleges and universities: program directors report
that the average age of these programs is 10 years old. The average
program has 66 students enrolled and six faculty members, which
typically includes two women, one minority and two financial
advisors. Eighty percent of financial planning programs surveyed
are housed in the business school.
About the Survey
The TD Ameritrade Institutional 2017 Financial Planning Program
Director Survey is the RIA industry's first-ever survey of
financial planning program directors, TD Ameritrade engaged True
North to reach out to all of the 105 four-year colleges and
universities with undergraduate financial planning programs in the
United States according to the CFP Board's list of registered
programs. Thirty-seven percent of schools participated in the
survey, which was fielded via email and telephone in September
2017. TD Ameritrade and True North are separate and unaffiliated
and not responsible for each other’s services and policies.
About TD Ameritrade Institutional
TD Ameritrade Institutional is a leading provider of
comprehensive brokerage and custody services to more than 6,000
fee-based, independent RIAs and their clients. Our advanced
technology platform, coupled with personal support from our
dedicated service teams, allows investment advisors to run their
practices more efficiently and effectively while optimizing time
with clients. TD Ameritrade Institutional is a division of TD
Ameritrade, Inc., a brokerage subsidiary of TD Ameritrade Holding
Corporation.
About TD Ameritrade Holding Corporation
Millions of investors and independent registered investment
advisors turn to TD Ameritrade’s (NASDAQ: AMTD) technology, people
and education resources to help make investing and trading easier.
Online or over the phone. In a branch or with an independent RIA.
First-timer or sophisticated trader. Our clients want to take
control, and we help them decide how - bringing Wall Street to Main
Street for more than 40 years. TD Ameritrade has time and again
been recognized as a leader in investment services. Visit our
newsroom or amtd.com for more information.
Brokerage services provided by TD Ameritrade, Inc., member FINRA
/ SIPC
1 TD Ameritrade Institutional is a division of TD Ameritrade,
Inc., a brokerage subsidiary of TD Ameritrade Holding
Corporation
2 CFP Board: Find an Education Program, as of September 2017
3 U.S. Department of Education, National Center for Education
Statistics, 2016
4 U.S. Census Bureau reports, 2016
Source: TD Ameritrade Holding Corporation
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version on businesswire.com: http://www.businesswire.com/news/home/20171110005206/en/
TD Ameritrade InstitutionalAlyson Nikulicz,
201-755-4116Communicationsalyson.nikulicz@tdameritrade.com
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