Potential advisors concerned about the perception of the financial industry

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It’s not money that necessarily attracts millennials or young people to the financial services industry. (Photo: Shutterstock)

Changing attitudes towards work and the public’s perception of it are leading to changes in how the next generation of financial advisors view the profession and the structure of their careers, issues other than compensation and the latest technologies taking precedence over the importance of having a worthwhile purpose when entering the profession.

In a joint Texas Tech University and Advisor Group survey, responses from students enrolled in Texas Tech’s personal financial planning and economics divisions indicate that 40% of potential financial advisors are concerned about overall negative perceptions of the industry financial.

“The next generation of financial professionals have different priorities and skill sets that set them apart,” says Deena Katz, a professor in Texas Tech’s personal financial planning division and president of Evensky & Katz/Foldes Financial Wealth Management, in a statement, adding, “These students represent the future of our industry.”

Of the respondents, 44% are aiming for professional certification and 38% place more importance on the ability to help others than on their overall compensation.

Additionally, 34% said being part of a dynamic industry was more important than money, with only 30% weighing in on the importance of compensation.

And while technology ranks high on the list of the industry’s top hiring incentives, it doesn’t rank nearly as highly with prospects, with 50% of respondents ranking technological advancements at the bottom of the scale. among the factors influencing their future career choices.

The next generation is also big on the importance of having a mentor; in fact, they think a professional mentor is almost as important as taking the necessary courses (28% vs. 31%, respectively).

“If we are to be successful in attracting the next generation to our industry, it is essential that we gain a better understanding of their perceptions and priorities,” said Valerie Brown, executive chairman of Advisor Groups, in a statement. The importance for the next generation to have a career with a higher purpose, the report says, must be underscored.

Brown adds, “While we all know that being a financial advisor is a noble profession, we need to do a better job of raising awareness about it in the minds of the next generation. We are excited to build on the results of this survey to improve our own next-generation initiatives and help bring attention to this important priority for our industry.

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