Common cents: Financial planners sharpen their focus on the next generation of clients

Published 10:08 am Saturday, October 19, 2019

By Martin Moylan

The people who want to help you plan your financial affairs are gathering from around the world at a conference in Minneapolis this week. They’re doing so at a time when baby boomers are hitting retirement and discovering how well or poorly they planned for it.

Financial planners or advisers help clients with a range of money issues from investing, taxes and insurance to how to pay for college. Planners usually charge a portion of invested assets, typically one percent or so annually. Some charge younger clients a monthly fee to help them sort through paying off student loans or how much housing makes sense, as well as saving strategies.

About 2,000 financial planners gather in Minneapolis this week to learn how to better serve their clients. Martin Moylan | MPR News

Email newsletter signup

“We have to provide advice that is in the client’s best interests, not just push products,” said Janine Sam, who directs the financial planning program at Shepherd University in West Virginia. She’s also a certified financial planner.

Nationwide, around 80,000 people have the education and experience needed for certification as a financial planner. Less than 10 percent are people of color. But Sam, who is African-American, said the profession is becoming more diverse.

“It’s changing, which is good,” she said. “There’s about 23 percent of certified financial advisers that are female.”

Skip Schweiss, president-elect of the Financial Planning Association, does not offer market forecasts, investment guidance for the near-term or other tips outside of a client relationship. His advice for everyone else boils down to this: Save early and save a lot.

“We see numbers routinely of people entering retirement or close to it with maybe $100,000 in their 401(k), something like that,” he said. “And if you’re going to live for 20 or 30 more years, that’s going to be kind of tough.”

In selecting a planner, Schweiss said it’s important to check credentials, character and performance. And you should decide if hiring a planner is worth the money.

“If someone says, ‘I’m a financial planner, trust me,’ do some homework and ask some questions,” he said. “We tend to steer people towards a certified financial planner CFP, as they have to go through a lot of education. They have to go through three years of training.”

Like other industries, financial planners may see some work done through artificial intelligence. Ingrid Strauss, a financial planner with Cordis Financial in Minneapolis, learned about robo-advisers and other tools that use algorithms to allocate and manage investments.

“That helps us do our job certainly more efficiently,” she said. “Technology always helps us, but it doesn’t replace that human interaction.”