Ladies and (predominantly) gentlemen, it is time for the financial planning profession to encourage more young women to consider this field as a viable career choice. There seems to be an earnest desire to change the status quo, but RIAs are coming up short on changing the demographic makeup of the profession.
Women with financial planning degrees are some of the most sought-after candidates, but female enrollment in financial programs nationally remains low, with the ratio of male to female students hovering about 3 to 1, according to the CFP Board's 2014 report, "Making More Room for Women in the Financial Planning Profession."
My conversations with financial planning program directors shed some light on how RIAs can help encourage more women to consider financial planning as a career choice.
Financial Planning Is Not Sales
For starters, independent advisors and financial planners need to get vocal about the opportunities that exist for young planners at fee-based fiduciary firms that do not play the high-pressure sales and commission game.
Too often, the individuals talking to the students hold themselves out as financial planners when they really are salespeople, according to Luke Dean, Ph.D., financial planning program director at Utah Valley University. Women in particular are turned off by the emphasis on sales.
"The women on campus say they want careers that offer flexibility, the opportunity to do good and the ability to provide for their families," notes Dean. "You and I know that a financial planning career can offer all of this, but when a sales guy starts talking about the high commissions you can make selling products, he immediately loses all the women in his audience."
John Grabel, Ph.D., CFP, financial planning program coordinator at the University of Georgia and former academic editor of the Journal of Financial Planning, agrees. "College-age women want to be part of a profession with a career path, not join an industry, whereas their male peers are indifferent."
He continues, "Unfortunately, 90 percent of recruiters are men who talk about selling product. Our women students have no interest in a male-dominated industry heavily reliant on commission-based compensation."
Independent advisors and financial planners can help even the gender imbalance by speaking to female students about the difference in their career path and how they serve clients. This means being on campus for career days, chatting with clients' children about their career choices, hiring interns and being a mentor.