Easing college students' transition into the financial planning profession

Financial Services Review, Fall 2005 by Goetz, Joseph W, Tombs, Joseph W, Hampton, Vickie L

In the interest of breaking this unfortunate cycle, an important goal of financial planning programs should be to ease college students' transition by closing the gap between professional productivity and classroom work. The traditional model of financial planning education is not meeting the demands of the marketplace and is consequently hindering the growth of the financial planning profession. Personal financial planning is an applied academic area requiring greater thought and creativity in the development of appropriate pedagogic approaches. Beyond the core competencies required by CFP Board, educational programs should emphasize skill development in the areas of ethics/professionalism, professional software applications, financial planning business practices, marketing, communication/counseling, along with opportunities to obtain licensures and certifications concurrently with education.

While the focus of this paper is on the changes that educational organizations can make to ease the transition of students into the profession, the transition will remain difficult unless the industry moves to embrace and reward a heightened level of preparation. For example, it is common practice for large financial institutions to take students graduating from financial planning programs and to place them into the same training program as students who did not study financial planning in college. Although this does give financial planning students a chance to shine in comparison to the students with different academic backgrounds, it is hardly optimal. Most firms do not invest in different training programs designed specifically to supplement the knowledge base that financial planning graduates already possess. As a result, the industry fails to offer higher salaries to entice financial planning students, because the firms are not equipped to take full advantage of their increased readiness.

The goal of this paper is to provide a model that academics and professionals can utilize to promote students' seamless transition from academia to the professional world. The proposed model, illustrated in Fig. 1, shows that the reward for curriculum reform is a more efficient assimilation into the profession. This compression serves the interests of students, the firms that hire graduates, and the academic programs supporting this higher level of learning. Ultimately, implementation of the model improves the profession as a whole. This improvement can occur from the activities of educational programs and the financial planning industry. Table 1 provides an overview of the various techniques that educational programs can utilize to close the gaps in the model and ease students' transition into the financial planning profession.

2. Techniques that bring the profession into the classroom

An important part of shortening the transition between university coursework and professional practice involves bringing the profession into the classroom. Research and the authors' experience support the effectiveness of a number of educational strategies that financial planning instructors can utilize in the proposed model to achieve this transition. The educational techniques and strategies proposed are based in Experiential Learning Theory, which purports the most effective learning takes place when a person is actively involved with an experience (Kolb, 1984). Recent research indicates the need for a shift to experiential learning in the classroom and provides evidence for its effectiveness and benefits over traditional models of passive learning (ElHs & Letourneau, 2001; Gold, 2002; Hakeem, 2001). Kolb (1984) defines experiential learning as a "process whereby knowledge is created through the transformation of experience" (p. S).