RIA industry awareness: Bringing financial services to life for young students

See how advisors teamed up with Texas Tech University and Schwab to spark interest in financial planning among students.

Educating young people about financial planning is a great way to give back to your community and build goodwill for your firm. And, raising awareness of the independent advisor career path is crucial to sustaining the Registered Investment Advisor industry's long-term growth. As part of its mission to support advisors by helping raise awareness of the industry and cultivating high-quality talent, Schwab Advisor Services™ partners with Charles Schwab Foundation to sponsor the Texas Tech University Financial Planning Academy. This unique program lets high school students experience the wealth management profession up close prior to selecting a major in college.

Tanner Castle started his freshman year at Texas Tech University with ambitious plans. Becoming a financial planner wasn't one of them, though.

Castle envisioned earning a pre-med degree until his older brother, who was already enrolled in Texas Tech's personal financial planning program, encouraged him to take an entry-level financial planning course. Less than a week into the class, "I had already made up my mind that I loved this content," he recalls. "It had so much daily impact in my life."

That firsthand experience inspired Castle to switch majors and set his sights on a possible career as an investment advisor. Now he's paying that inspiration forward by helping Texas Tech raise awareness about the industry among high school students.

Alongside professors and financial advisors, Castle participated as a mentor to students at the inaugural Texas Tech University Financial Planning Academy. Supported by a grant from Charles Schwab Foundation, the academy gave 39 teenagers from seven states the chance to build their personal finance skills and explore career opportunities in wealth management.

Bridging the gap

One of the major challenges is that financial planning isn't recognized as a first-choice degree or career option. Our idea is to expose kids to financial planning at a younger age."—Dr. Chris Browning, Texas Tech Professor and Co-creator of the academy

Amid the exponential growth in the RIA industry—to over $4 trillion in assets under management1—many advisors have struggled to attract younger talent to their firms. Cerulli Associates has predicted the RIA channel will gain 4.9% market share by 2020 while other areas decline,2 making new talent acquisition even more crucial to sustaining the industry's growth.

The Texas Tech Financial Planning Academy raises awareness of the industry and shows the next generation what it means to be a financial planner in hopes that more students will pursue financial planning as a career. "More than ever before, developing a diverse talent pipeline, with a team who can ultimately become the next generation of leadership, is crucial to firms' success," says Bernie Clark, executive vice president and head of Schwab Advisor Services.

Browning worked with Deena Katz, CFP®, a Texas Tech associate professor and executive at the Schwab IMPACT Award–winning RIA firm Evensky & Katz/Foldes Financial, to create the Financial Planning Academy with an eye toward changing students' perceptions of this industry.

"They are under the impression that you're a 'stock jockey': When the market goes up, everyone loves you and when it goes down, they hate you," she says. Negative images like these contribute to a lack of awareness about financial planning degree programs nationwide. Katz adds, "Most people do not come to universities to study financial planning. They learn about it when they get here."

Professional advisors bring real-world perspective

"'Awareness, exposure, and opportunity' has been my mantra for a long time," Turner says. "Young people have to know 'You can be a financial advisor.' Next they have to get exposure: 'What does a financial advisor do? Can I talk to one?' And the last piece is they have to have the chance to participate via internships, going to camp, shadowing advisors, or similar opportunities."

" 'Awareness, exposure, and opportunity' has been my mantra for a long time… Young people have to know 'You can be a financial advisor.'"
—Trudy Turner, Advisor, United Capital

As a first step in that direction, Texas Tech made an authentic and positive impact on students by providing a hands-on learning experience and bringing the perspectives of real financial advisors to them throughout the week.

Along with attending lectures by faculty and guest speakers from the financial planning industry, students worked in teams to develop and present viable wealth management plans to a panel of judges from the financial planning community. Members of the winning team each received a $500 cash award. Students who expressed interest in pursuing a financial planning degree at Texas Tech were invited to apply for a $1,000 scholarship; the academy awarded a dozen such scholarships during its closing assembly.

Getting to meet role models in the profession is invaluable for students who otherwise might have little or no exposure to financial planning. Hearing their firsthand accounts of their experience in the industry could be the push a student needs to choose financial planning as a career path.

"Having advisors involved in programs like the Texas Tech Financial Planning Academy will help create even more excitement about this industry," says Clark.

Be a role model and industry advocate in your community

Here are four ways you can get involved and make a difference:

  • Speak at local high schools and universities. Volunteer as a presenter at career days and similar events, or become a mentor for students in the school's financial planning degree program. Schwab has created a presentation through the RIA Talent Advantage™ program titled Careers in the Independent Advisor Industry, which you can use to help guide these types of conversations.
  • Get involved with industry advocacy groups. This is a great way to influence public opinion about the advisor industry and to interact with talented professionals early in their careers. The Certified Financial Planner Board of Standards and other professional organizations regularly sponsor outreach programs in local communities.
  • Create an internship program. Giving college or high school students the chance to experience how you work with clients, solve challenges, and build a business can be invaluable for them—and a strong way to differentiate your firm from other advisory firms.
  • Strengthen financial literacy. Young people and families, particularly in disadvantaged communities, can benefit from your expertise. Consider teaching a course on money management or related topics through a local nonprofit organization such as Boys & Girls Clubs of America, Junior Achievement, Kiwanis, or Rotary. Schwab has a national relationship with Boys & Girls Clubs of America that includes the Money Matters: Make It Count program, and advisors are encouraged to volunteer at their local clubs to teach the curriculum. In addition, Schwab offers curriculum and materials through SchwabMoneyWise.com that advisors can use when working with teens and young adults in other organizations around the country.

Independent advisors are uniquely qualified to help raise young people’s awareness about financial planning skills and potential careers. What’s more, connecting with young people to stoke their interest in financial planning careers can help strengthen your brand reputation and set you apart from the competition.

Reach out to your Relationship Manager to discuss how you can help young people learn about financial planning career paths in your local community.

If you're thinking about becoming an independent advisor, consider a custodian who invests in your success. Contact us to learn more about the benefits of a custodial relationship with Schwab.

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