Hot Commodities: Why Colleges and Universities are Focusing on Financial Planning Grads
October 6, 2014 | Business and Careers
In an otherwise challenging job market, there’s one career path with an exceptionally bright outlook—and that’s financial planning. In fact, the U.S. Bureau of Labor Statistics forecasts that the number of job openings for financial advisors is expected to grow 27 percent from 2012 to 2022. That’s more than double the 10.8 percent average growth rate for all occupations.
Several factors are fueling the demand in this field.
- First, millions of baby boomers are facing the challenge of having to plan for a longer life expectancy without the benefit of a pension plan. As a result, many are likely to need help creating a sustainable retirement income from their savings and investments.
- Second, an even larger generation of younger investors is now entering their prime earning years. As they do, they will be looking for well-trained financial professionals who can help them build and manage their wealth.
- And third, just as shifting demographics are creating a stronger demand for financial advisors, the supply is shrinking. Many of today’s financial advisors are boomers themselves. As they retire, the door of opportunity will swing even wider for young people and midlife career changers to enter the business.
Building Talent Through Education
The growing need for talent isn’t lost on colleges and universities across the country. Propelled by a sense of urgency to provide students with marketable skills, many are creating undergraduate and graduate programs targeted specifically to the field of financial planning.
William Paterson University, located in Wayne, NJ, is the largest such program in the Northeast. Named among the top schools for financial planners by Financial Planning Magazine for the third year in a row, William Paterson’s financial planning majors have consistently garnered top awards in national financial planning competitions since the program’s inception in 2009.
Duncan Williams, Ph.D., a professor of financial planning at William Paterson and one of the program’s chief architects, has seen interest in this program soar in recent years—and for good reason. “In many ways, now is a golden time to become a financial advisor. The industry is shifting toward a focus on holistic planning, which means advisors have the opportunity to take a front-row seat in helping clients plan for their most important life events,” said Williams. “In terms of future growth potential, few degrees today provide the economic return that a bachelor’s degree in financial planning can offer. Our students are in high demand both for paid internships and full-time career positions, and many have had multiple job offers to choose from before graduation.”
Michael Van Grinsven, a director in the Field Growth and Development department at Northwestern Mutual, confirmed that financial planning can be personally and professionally rewarding. “Helping people and impacting lives motivates many entering the financial planning business. Financial planning typically rates high in surveys measuring compensation and overall career satisfaction.”
Drivers of Success
According to Lukas Dean, Ph.D., a professor in the financial planning program at Utah Valley University, students in the top financial planning programs have a leg up with recruiters. Utah Valley was also named a top 10 school for financial planning by Financial Planning Magazine.
Dean suggests that financial planning majors are popular with employers because of their well-rounded training. “Our students are immersed not only in a solid base of financial planning products and tools, including being trained in the latest financial planning strategies and software; they’re also exposed to public speaking and professional sales training. These are skills that students wouldn’t necessarily get if they majored in finance or other more traditional business-oriented courses of study.”
Graduates with a financial planning major are better prepared to succeed in the workplace, said Dean. “That’s part of the reason our financial planning majors typically receive multiple offers before graduation.”
Drs. Williams and Dean both have seen how strong ties to the financial planning community can help students secure vital industry experience. Dr. Williams pointed to a financial planning competition Northwestern Mutual recently helped sponsor at William Paterson University. Its goal was to provide financial planning students the opportunity to use what they learned in the classroom and connect it to a real-world situation.
Northwestern Mutual gave participants a case study and asked them to create a written financial plan based on the client’s assets, debt and cash flow. Those plans were evaluated by a panel of industry professionals, who provided feedback to each participant. The top five participants presented their plans orally in front of mock “clients” played by Northwestern Mutual representatives. Monetary prizes of between $500 and $2,500 were then awarded based on the students’ initial case analysis, presentation skills and delivery of the plan. “The competition got an enthusiastic thumbs-up from students because it provided an excellent opportunity for them to test their planning and communication skills and get feedback from industry experts,” said Williams.
William Paterson University also partners with Northwestern Mutual to offer students the opportunity to gain hands-on experience working with proven financial representatives and professional office staff who know what it takes to succeed. This access to financial planning practitioners is crucial to a well-rounded financial planning education, according to Williams.
“Partnering with innovative educators at colleges and universities like William Paterson and Utah Valley is essential to our mission,” explained Van Grinsven. “By working together, we can help grow the number of well-trained financial planning professionals available to serve individuals, families and small businesses.”