The financial planning industry is counting on universities to produce young planners who will replace the older practitioners who are nearing retirement. The CFP Board of Standards, with the financial backing of TD Ameritrade, recently announced plans to encourage more academic research into topics central to financial planners, and to groom more academics to obtain advanced degrees and thus become the teachers of those undergraduate financial planning students.
But Ajamu Loving, asssistant professor of financial planning and director of academic partnerships at the American College, is focusing on another group: community college students across the country who will be learning about financial planning in the years to come and may even aim to become financial planners.
It’s been a year since Loving joined the American College. The former assistant professor of finance at Texas A&M University, who has a doctorate in personal financial planning, believes that education is the best way to take on the dual problem the financial advisory industry faces: Increasing the number of advisors in the business as the current population ages and increasing diversity in the advisor population.
Loving’s plan includes partnering with four-year and graduate degree-granting institutions to help increase course offerings and reaching out to colleges that don’t yet offer these programs. “If we can increase the interest in financial planning among young people, that would help greatly in boosting the number of advisors in the industry,” he says. “I believe colleges and universities are very important because they make an effort to recruit and maintain diverse populations, so to the extent that we can partner with and support programs at these institutions, we will see a greater number of young people from diverse backgrounds becoming the new financial fiduciaries.”
Currently, the American College is partnering with the University of Houston to broaden the financial planning courses it offers and to provide students with extra courses and designations. The College is also working in the same way with Clayton University in Nebraska, which has a fully formed CFP program, and is in talks with a number of other universities, including some historically black colleges.
Over time, Loving hopes to reach out to and enter into the same kind of partnerships with community colleges.
“So many people from minority backgrounds go to community colleges and if you can get them exposed to the idea of financial planning in a two-year college program, that will help a great deal in taking away the idea that ‘this profession is not for me,’” he says. “Even if minority kids know what a financial advisor is, most of them see an advisor as a particular kind of white guy who wears Dockers and who is so far removed from their world. But if we can raise the profile of financial planning in those communities, if we can generate some interest and traction, then more of these kids will know that financial planner is a profession that they can also do.”
The potential audience for Loving’s plan is massive: According to the American Association of Community Colleges (AAAC), in fall 2014 there were 7.3 million undergraduate students enrolled in community colleges—2.8 million full time and 4.5 million part-time—and an additional five million noncredit students.
Loving’s broader goal is to ensure access to financial planning for all Americans. The more colleges, universities and, eventually, community colleges that turn out qualified graduates from different backgrounds who will join the profession, the greater the likelihood of achieving that goal, he believes.
“I want this industry to be a field that represents everyone regardless of background and ethnicity, because everyone works and everyone has to retire, and so we need to make sure that everyone is engaged,” Loving says. “In the same way that there are doctors of all backgrounds, and in the same way that we pay attention to our health, it’s important for us to understand how to deal with our economies and figure out how we are going to manage our finances through our lives. Everyone goes to the doctor – my goal is to make financial planning more like medicine, so that everyone will have access to a practitioner.”