While the project to expand the Keystone XL oil pipeline is mired in years-long political and regulatory delays, one company continues to grow a pipeline to deliver fresh faces to the financial planning industry.
Since its launch in 2010, TD Ameritrade Institutional NextGen focus has expanded and grown a three-pronged program to bring much-needed new talent to RIAs through scholarships, internships, grants and tools for advisors and students, including a career exchange website.
The Bureau of Labor Statistics predicts that financial planning jobs will increase by 27 percent through 2022, tripling the overall U.S. job growth rate. At the same time, recent data from the U.S. Department of Education shows that around 700 students graduated with financial planning degrees from around 90 schools in 2013, not nearly enough to meet the demand for new talent.
“When we take a look at the industry, we see a pending advisor shortage,” says Kate Healy, managing director in charge of marketing for TD Ameritrade Institutional. “Right now, only six percent of advisors are under age 30.”
Combined with a graying contingent of financial professionals – the average age of an advisor is currently 52 years old – today’s number of financial planning graduates doesn’t match the predicted outflow of talent.
That’s why TD Ameritrade has opened the spigot, says Healy, promising a $2 million investment over the next decade to raise awareness of the career prospects for financial planners.
“We’re looking to do anything we can to elevate this profession,” Healy says. “What we’ve heard from advisors is, of course, that they recognize the problem and want to do something to address it, but don’t necessarily know how to begin. We’re looking to make it easier for them.”
For the past three years, TD Ameritrade has awarded the NextGen Financial Planning Scholarships, growing the program support from ten $5,000 scholarships in 2013 to 12 this year.
To address the dearth of women and minorities in the advising industry, the company is increasing its focus on students from underserved and under-represented groups. The new awards will be earmarked for African Americans, Latinos, Asian-Americans, or women.
“We recognize that there is still not enough diversity,” Healy says. “Research says that 40 percent of millennials are ethnically diverse, significantly more than previous generations, so we want to make sure advisors are creating diverse work cultures.”
In general, the scholarships are awarded to college freshmen, sophomores or juniors pursuing financial planning degrees at a four-year university. Since 2013, the program has given a total 34 awards.