Journal of Financial Planning: September 2015
Dave Yeske, DBA, CFP®, is managing director of Yeske Buie. He holds a doctorate in finance from Golden Gate University and has been practicing financial planning since 1990. He is a past chair of FPA and currently serves as the Journal’s practitioner editor.
Back in 2011, Elissa Buie and I published a paper in the November issue of the Journal titled “Evidence-Based Financial Planning … To Learn Like a CFP.” Many of you will recognize the title as one more link in the conceptual chain launched by Dick Wagner in his seminal 1990 Journal paper, “To Think … Like a CFP.” In our own paper, we offered three propositions: first, that the best practices that emerged over the profession’s 45-year history were often based on tradition and intuition and would be better if validated by the methods of science; second, that we need a more robust dialogue between the realms of practice and the academy; and, finally, that financial planners can only drive this change and navigate the new landscape if they possess the ability to identify, evaluate, and implement the findings of research-based writing.
I won’t recap here the methods of science and its relation to our profession’s body of knowledge; for that I will refer the interested reader to our 2011 paper. I will focus instead on the critical importance of creating a richer conversation between the communities of practice and research.
Connecting Planners and Academics
Financial planners often adopt and share with colleagues practices that are born of trial-and-error and intuition rather than empirical validation. At the same time, academic research focused on financial planning is too often answering questions financial planners aren’t asking. The obvious solution is to find better ways to connect financial planners who know the crucial questions of the day with the academics who have the knowledge and skill to conduct the necessary research to answer those questions.
FPA has been working diligently on the solution, first by forging a deeper partnership with the Academy of Financial Services (AFS), the oldest association devoted to the interests of financial planning educators and researchers; and secondly, through the creation of the new FPA Theory in Practice Knowledge Circle.
The Knowledge Circle will bring together practitioners and researchers in a dynamic venue that will allow researchers to share ideas for new approaches to serving clients and find practitioners willing to implement those approaches and gather data that can be used to test and validate— or repudiate—the proposed new approaches. Likewise, practitioners can come to the group with questions and challenges they’re facing in their daily practice and find academics who can help structure research aimed at uncovering viable solutions.
Here’s how Christine Walsh, FPA’s community program manager, describes the project: “Like all Knowledge Circles, this peer-to-peer conversation group provides FPA members an opportunity to share best practices and learn from each other. Theory in Practice is sure to morph as it grows, and we are open to its natural progression. The plan is to give the financial planning academic community a safe space to vet their research ideas. There will be lots of open debate and online conversation, as well as monthly calls. We will work with the Journal to raise awareness of innovations in the industry and the practicality/feasibility of implementation. I believe it will garner a high degree of interest from all involved.”
Ever since my time as chair of FPA’s Research Center Team and, later, the Academic Advisory Council, I’ve been hoping to see a group and a venue like this, and I invite all of you to become active members of what will no doubt become a critically important community for advancing our profession’s body of knowledge.
Evaluating Research-Based Writing
I’d like to turn now to the third proposition from our “Evidence-Based Financial Planning” paper: that financial planners need to be able to identify, evaluate, and implement the results of research-based writing.
To begin, I’d like to note some underutilized resources that every FPA member has at their disposal, beginning with the Journal archive. In conversations with colleagues and Journal staff, it is clear that most members do not take advantage of this amazing resource. By logging in to the Journal website and accessing the archive, members gain full access to the Journal’s nearly 40-year publication history.
In my own doctoral research, which was devoted to developing a model of the strategy-making activities of financial planners (“Finding the Planning in Financial Planning,” published in the September 2010 Journal), I made extensive use of this resource, which, inevitably, provided the majority of my literature review, being the longest-standing source of research-based writing within our profession.
The Journal archive should be your first stop whenever you’re struggling with a client problem or a research question. I recently had an admittedly geeky client email me asking about LTC insurance, not for my opinion but whether I could direct him to some informative articles. As always, I went first to the Journal’s archive and found two excellent articles that took an analytical approach to evaluating LTC funding vehicles and comparing their performance under different scenarios (“Long-Term Care: Helping Clients Make the Right Choices” from the November 2012 issue, and “Long-Term Care Insurance: Comparisons for Determining the Best Options for Clients” from the February 2015 issue). Also, within our firm, we conduct an internal training program we call Yeske Buie University (YeBu U for short), which relies heavily on research-based writing from the Journal. Such researched-based writing—which goes through a peer review process before being accepted for publication—appears in the “Contributions” section of the Journal, by the way.
Another benefit of which many members are not yet aware is free access to the Academy of Financial Services’ quarterly journal, Financial Services Review. Wherever you access the electronic version of the Journal, you will also find the latest issue of Financial Services Review awaiting your reading pleasure. And while it’s true that some of the papers published therein are skewed toward the interests of career academics, such as how to best teach financial planning subjects, most papers have practical implications for practitioners. I highly recommend you take advantage of this valuable member benefit and even consider joining the Academy of Financial Services if you have any interest in financial planning’s academic realm.
In 2011 and 2012, when Elissa and I were giving presentations at various FPA conferences based on our “Evidence-Based Financial Planning” paper, I would routinely ask the audience: who among you would be interested in a class or seminar or conference presentation that would help make you a better consumer of research-based literature? Invariably, every hand in the room would go up. That led to a personal goal I am finally bringing to fruition: a college-level short course devoted to helping practitioners learn to better evaluate research-based writing. This five-week class, Evaluating Research: Understanding and Using Applied Research in Your Practice, is being offered through Golden Gate University’s Ageno School of Business, where I was recently appointed director of the financial planning program. The class will be delivered via the University’s eLearning platform, which means it can be taken by anyone, anywhere. FPA, meanwhile, has negotiated a grant with the university, making this course available to FPA members for a deeply discounted tuition of $199. I will be teaching the first session, which starts October 29, and I look forward to spending five weeks with what I am confident will be a dynamic and exciting learning community. We also expect the class to qualify for 15 hours of CFP continuing education. You can find more information at www.ggu.edu/research.
Creating an Evidence-Based Profession
Increasingly, it feels like our 45-year-old profession has reached an inflexion point, one that can catapult us to new levels of professionalism and legitimacy if we can but seize the moment.
Through the efforts of FPA and AFS and the new communities that are springing up to become laboratories for exploring the crucial questions we face daily, we have a chance to take a great leap forward in serving our clients, our communities, and society at large. All that’s required is for each of us to become evidence-based financial planners, acquiring the relevant skills and actively participating in the professional initiatives that aim to make an evidence-based profession a reality. This is one of those moments when the traditional curse, “May you live in interesting times,” feels more like an invitation and a promise than a fate to be feared.