Give it the Old College Try: RIAs Must Compete Harder to Recruit Top Undergrads, Finds New TD Ameritrade Survey

First-ever survey of college administrators reveals that growing
next-gen talent pipeline means increasing awareness about financial
planning as a profession

JERSEY CITY, N.J.–(BUSINESS WIRE)–$AMTD #Advocates4RIAs–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 Institutional
1. 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.

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

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

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

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
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


TD Ameritrade Institutional
Alyson Nikulicz, 201-755-4116