By Caleb Brown, CFP®
The current economic conditions have caused many financial planning firm owners to re-evaluate their advice model, add services and even improve their planning skills to set themselves apart. New graduates from financial planning programs are not immune to this downturn and should follow the firm owner's lead. Since jobs are not as plentiful as they once were, graduating students need to focus on augmenting their skills to improve their chances for securing a position and being successful in the financial planning industry.
The CFP program curriculum lays the educational foundation, but it is up to the student to fine tune his or her skill set to a firm owner's needs above and beyond the core technical content. Here are some ways for students to expand their knowledge to give them the competitive edge. The better prepared students are, the quicker they can integrate into planning firms, leading to greater success for both the student and the firm.
Interpersonal Communication and Psychology
This may be the most important skill aspiring planners will need to be successful in financial planning and in life. Students should take as many extra classes and read voraciously in this area; the value of this knowledge comes back to help exponentially. Moreover, strong interpersonal skills become better practiced every day in interactions with family and friends, learning to pay better attention to verbal and non-verbal cues along the way. This does not mean becoming a therapist or licensed psychologist, but simply becoming more aware of especially the non-verbal cues of effective communication.
Most planners enjoy a successful career and are good at what they do, not because they know what investments to select-although most are good at this as well-but because of the listening, communication and relationship skills they have developed. They know what the client is going to say before it is said, because they are always two steps ahead-just like a chess match-through knowledge, practice and experience.
Come to the table with an understanding of interpersonal communication and psychology and use it to deal with people in a more effective manner. This is something that can always be improved and practiced for the rest of your life.
Professionalism
Unfortunately, overall professionalism is often forgotten, especially at the undergraduate level. New planners need to strive for much more than the minimum, because it is expected and demanded by clients, business owners and colleagues. Remember that anything you do publicly reflects on your professional image, so be cautious about mistakes such as:
- Questionable content on a MySpace and Facebook pages that might be accessed by a potential employer or client
- Accidentally replying to an e-mail instead of forwarding and communicating an inappropriate message to the wrong person
- Asking someone to lunch for advice or mentoring help, and then arriving late or expecting them to pay the bill
- Making up poor excuses for being late or doing something wrong, rather than simply being honest and coming clean about it
Some might think that these issues do not regularly come up and basic professionalism is second nature, but that is not always the case!
Real World Experience
Recent college graduates probably don't have much life experience outside the academic environment, so they should do everything they can to start getting some experience. New planners should try for as many internship, practicum, co-op, study abroad, travel and volunteer opportunities as possible.
One of the biggest complaints expressed by many newer planners is that they are not able to participate in client meetings. Obviously it depends on the situation, but lack of life experiences is often a reason. It is much more difficult to counsel a client on basic planning issues such as selecting the proper mortgage, fixing problems on credit reports, estate planning or deciding whether to buy or lease, if the new planner has never been through the process.
If the situation permits, new planners should try to personally go through some of the following:
- Purchase a home or select a mortgage. If that isn't an option, they should consider accompanying a friend or relative through the home buying/mortgage process to gain some familiarity.
- Become familiar with contracts by reading lease agreements and having legal documents prepared.
- Negotiate a new car deal and run the numbers to see whether financing or leasing is the best option.
- Pull their personal credit report every year to review and correct any mistakes.
- Make sure they understand everything about their personal income tax returns.
Newer planners may find that these experiences provide valuable perspective on guiding a client to complement what they have already learned in the classroom.
Familiarity With Software Programs
Although there are a few CFP programs that are offering technology classes, the reality is that software and technology are keys to an applicant's success. Most entry-level positions will require the use of software programs typical in the industry, and often quite extensively so. Ideally, new graduates will have at least been exposed to or used programs like these in their course work, but if not, they should take the initiative and conduct research themselves. Typical programs a new planner should be familiar with include:
Financial Planning
- MoneyGuidePro
- Money Tree
- NaviPlan
- Financeware
Customer Relationship
- Junxure
- ProTracker
- ACT!
- GoldMine
Portfolio Management
- Schwab PortfolioCenter
- Advent Axys
General Office
- Word
- Excel
- Access
- PowerPoint
- QuickBooks
There are many more software programs out there that new planners may be required to use; this should not be considered an all-encompassing list. Nonetheless, these programs are some of the most popular among planners today.
Technical Expertise
New planners need to be able to understand, explain and apply the rules and concepts they learned from text books into the bigger picture, real-life client situations. They need to have a thirst for knowledge, because there is a plethora of information they are responsible for, especially if they want to practice as a generalist. Reading as many financial magazines and publications as possible-most subscriptions are free-will help keep them up-to-date on changes in legislation and new client strategies.
Also, new planners should work through as many case studies as possible. Ideally, projects and exam questions, even while still in school, will test abilities that apply in real-life client situations. This will also go a long way in helping pass the CFP exam, which is an absolute must for planners who want to work with clients in today's financial planning firms.
If new planners focus on developing or improving these skills, they will significantly improve their appeal as job candidates and accelerate the success of their career paths, now and for the rest of their career to come.
Caleb Brown, CFP® is a practicing financial planner and partner in New Planner Recruiting, a recruiting firm specializing in placing top talent in entry-level professional positions within the financial planning industry. Contact him at cbrown@newplannerrecruiting.com.
