The American College of Financial Services has named finance professor Michael Finke its new dean and chief academic officer. Finke, who teaches and serves as director of retirement planning and living for Texas Tech University’s department of personal financial planning, is set to take on the role this summer.
The financial-planning instructor is widely praised for his work with Wade Pfau of the American College on “the 4% rule” for annual retirement withdrawals, which they criticized in light of lower rates of returns for portfolios today tied to the low-interest-rate environment. “Using current TIPS rates, which are the most accurate current inflation-adjusted bond yield, we find that failure rates rise beyond 50% using the 4% rule,” the authors explained in a study released in 2013.
Finke has published more than 50 peer-reviewed articles and appears regularly in general publications such as The Wall Street Journal. He is a frequent contributor to Research magazine.
“My sense is that financial planning is increasingly becoming more reliant on providing knowledge as a source of value and becoming more of a traditional knowledge-based profession,” he said in an interview. “This new role gives me the ability to have a significant impact on an institution with such a broad reach within the profession of financial planning.”
With a growing number of investors turning to automated investing platforms — so-called robo-advisors — Finke says it is a critical time of change for the field of financial advice.
“Especially as we are beginning to enter a new era in which individuals will be responsible for managing their own financial resources and relying on the guidance of professionals, especially when it comes to retirement resources. This is a global phenomenon.”
The American College, which serves about 20,000 students, “has done a fantastic job on building a body of knowledge in the retirement income planning area. It will be exciting to build on its success.”
The college provides education and training for the CFP, ChFC and other advisor designations.
“What Finke offers – a commitment to world-class research and innovative ideas that solve practical problems in the financial planning profession – will be transformative for the American College,” said the college’s president and CEO, Robert Johnson. “Whether he’s working with companies to explore the best way to use financial products, speaking with professionals about developing better ways to provide value to clients, or coming up with new and better ways to explain concepts to students, [his] primary goal has been to operate at the intersection of practice and academia, helping make financial planning a true profession.”
The American College, which it says has educated about one in five advisors in the U.S., is located in Bryn Mawr, Pennsylvania, near Philadelphia.
— By Michael Finke on ThinkAdvisor: