For the last five years, I’ve spent a significant amount of my time running The Externship, the only online training program for new and aspiring financial planners. More than 3,200 Externs have completed what is now considered the premier training experience in the profession.
I created and launched The Externship in 2020 as a solution for students who lost their summer internships. Some were at risk of not graduating on time, and all were losing valuable experience that would propel them into their careers (and certifications). This was not only detrimental to the students’ own career aspirations; it was a blow to a profession already facing a talent shortage.
When 1,900 people signed up, we quickly realized we created something much bigger and broader than a temporary solution to a temporary problem. We had created a program that addressed some of the more systemic challenges facing the financial planning profession. Namely: access.
Five years and 3,200 alumni later, I’ve learned a lot about the future of this profession and the new and aspiring planners entering it. If you’re considering hiring a new planner for your firm, here are five lessons to consider—all stemming from the last five years leading The Externship.
Lesson 1: Entering this profession is harder than you think. I’ve always known that there are steep barriers to entry into the financial planning profession, but it wasn’t until I started regularly engaging with aspiring planners that I learned just how daunting they are.
This is a profession with no clear entry point and extensive experience requirements. At the same time, training for new planners is, at best, inconsistent. At worst, it requires these fresh-faced aspiring planners to arrive with a network of wealthy friends and family to call upon.
Each of these are sizable barriers, but put them together and it’s a wall too high to climb. Only the privileged few have the personal connections to get a foot in the door. They’re also the few who have access to and receive the training and experience needed to flourish in this profession.
In short: this is not an “easy” career path for a vast majority of people. And for career changers, these barriers make entry into financial planning a near impossibility.
There has to be a way to keep our training standards for new financial planners high while not assuming that success comes down to connections, luck, or privilege. Can you imagine if other professions operated like this?
What if we hired 100 lawyers, didn’t train them, and told them that by the end of the year, all but one would be fired—and he would get everyone else’s book of business? What if we told a newly minted gastroenterologist that step one was cold-calling her parents’ friends to drum up business?
The Externship is a success and is still relevant four years after the pandemic because it addresses many of the profession’s barriers to entry. If our profession and your firm are going to continue to thrive, we must be aware of these barriers and the assumptions about becoming a planner that we unconsciously carry.
Lesson 2: Don’t discount career changers. When 1,900 people signed up for The Externship in 2020, the majority of them were not students. No one was more shocked about it than I was. When I envisioned aspiring financial planners, I thought of 22-year-old college students. It was only after I began understanding the realities of our profession’s barriers to entry that Extern demographics made perfect sense.
Only about 20% of our Externs are traditional students. Most have already been in the workforce. Some stumbled upon financial planning well into their careers and wished they’d known about it a decade ago. Some are parents returning to the workforce, and some are military veterans.
My takeaway? Don’t discount career changers. Their transferable skills are invaluable. I’ve seen it every summer for the last four years.
• The former university administrator knows the financial aid process inside and out – every loophole, every deadline, and every detail.
• The veteran knows about team-building and financial planning considerations for people with security clearances.
• The former teacher knows the peculiarities of state retirement systems.
• The former engineer may understand processes better than any employee you’ve ever hired.
• The parent returning to the workforce knows how to juggle responsibilities and face crises with calm.
You're doing yourself and our profession a disservice if you overlook career changers or someone who’s been out of the workforce for a while. Imagine a job candidate who knew their previous career inside and out, and who possesses soft skills and maturity. That is a valuable candidate.
Lesson 3: Lean into the importance of technology. Deep knowledge of common financial planning platforms opens doors for aspiring financial planners—and the firms that employ them. Experience with common FinTech tools and software experience is not an add-on skill or a “nice to have” checkbox on a resume in today’s digital age. It’s a critical component of hiring, one that enables both the new planner and the firm to hit the ground running.
By including access to tools like eMoney, Asset Map, MorningStar, and others inside The Externship, we found that aspiring and working planners alike felt much more capable in their work. They could make an impact faster and do the actual work of a planner with more accuracy.
If you’re hiring a new planner, remember that technology access and in-depth training are non-negotiables. Training new planners to use and stay up-to-date with FinTech tools will only help your firm and its clients. Plus, providing access and training on these tools will help you attract stellar talent—and retain them.
We received this feedback about the expanded role of technology from a 2023 Extern preparing to return to the financial planning profession after stepping away for many years to raise her family. “It was amazing to see the many ways that technology has made connecting to clients and solving for answers to client questions streamlined.”
This speaks so clearly to the entire purpose of technology: it allows us to better connect with clients.
Lesson 4: Next-gen planners are changing the narrative. We work in a profession that is easily caricatured —the Wall Street boss in the three-piece suit and the villain in a made-for-TV Christmas movie.
I don’t think financial planners are like that at all, but next-gen planners are about as opposite as you can imagine. As a whole, millennials and Gen-Z’ers do not have the same motivations as baby boomers or Gen-X’ers. You won’t get far in your recruiting if you focus on earnings potential. The data from past Externs backs this up.
Every year, we ask our incoming Externs their motivations for joining the financial planning profession. Their number one motivation, year after year, is helping people.
The next generation of financial planners understands that financial planning is a helping profession. This is their prime motivation, eclipsing considerations like salary expectations, job demand, and work/life balance.
2023 Externship Survey Question: What Attracted You To The Financial Planning Profession?
Lesson 5: Training is essential for success. The entire reason our profession exists is to evaluate and steward a client’s resources with strategy, wisdom, and intention so they grow over time. And yet, within our own profession, we lag behind in recruiting, training and retaining our most important resource: talent.
After years of researching this problem with professional organizations, industry leaders, and universities, I’ve come to the conclusion that most firms are not structured for successful training and onboarding. It is through no fault of their own; it is simply that there is not the personnel, the institutional knowledge, or the outside support for talent training and onboarding.
It was for those reasons that we created The Internship/Externship Program, which uses The Externship and our Firm Toolkit as a framework to help firms successfully run internship programs. The program started after a number of firms approached my team for a way to make hosting summer interns a possibility. By creating a program where the time and training burden is removed, we’ve found a new way to serve firms and the next generation of financial planners.
Looking Toward The Future
If I were to sum up everything I’ve learned in the last five years, it would be this: The financial planning profession has long been an excellent career choice. There are many different career tracks available, and when it comes to upward mobility, the sky's the limit. But what we’ve been missing all along is a welcome mat.
I’m proud that The Externship serves as that welcome mat. But with the right consideration and planning, I believe we can all create a more welcoming profession, one that serves clients to an even higher standard and attracts diverse, talented individuals who are ready to make a difference.
Doors to the 2024 Externship close on May 24. Learn more at www.amplifiedplanning.com.
Hannah Moore, CFP, is the founder of Guiding Wealth.