Why training programs like The Externship are essential for future of financial planning

The financial planning profession has a people problem. According to recent McKinsey research, the number of financial advisors is expected to decline significantly over the next decade, and we’ll be facing a shortage of 90,000 to 110,000 advisors by 2034. At the same time, new Cerulli Associates data shows that 70% of new advisors leave the profession within their first five years.

This isn’t just a problem for individual firms — it’s a crisis for the entire profession. Without a structured, industry-wide effort to attract new financial planners, we risk falling short of the growing demand for financial advice.

As advisors, as firm owners, as advocates for this profession, we need to start investing in scalable, accessible, and competency-based training programs that not only bring new advisors into the field but also prepare them to stay and thrive.

Cerulli Associates data backs this up, emphasizing how imperative effective training programs, professional development opportunities, and mentoring are in combating high attrition rates among new advisors.

The advisor shortage: A profession-wide problem

The financial planning profession has had a pipeline problem for years, maybe even decades. While many firms focus on individual hiring needs, the reality is that we are not attracting enough new talent into the profession fast enough to replace retiring advisors.

A major factor in contributing to this shortage is awareness of the profession. People just don’t see the profession as a path for them, whether they’re college students, career changers, or individuals returning to the workforce. Maybe they haven’t heard about financial planning as a viable career option or (more likely) they don’t see themselves represented amongst our numbers.

For those who do enter the field, they are more likely than not to often find themselves unprepared and unsupported. New planners quickly realize that passing their exams doesn’t automatically prepare them for client interactions, decision-making, navigating firm expectations, or building a book of business. The current level of attrition Cerulli cites is unsustainable, and it highlights a critical issue: a path into the profession isn’t clear for most, and the way we train new planners isn’t working.

Gaps in current financial advisor training and development

Even when firms successfully recruit new planners, many struggle to provide training that goes beyond the process. Plus, firm owners and senior advisors often don’t have the time, structured programs, or bandwidth to fully support new talent.

The most common training pitfalls include:

●           Process-driven training: New hires are often taught what to do but not why. They may learn how to follow workflows and use software, but they lack the critical thinking skills necessary to adapt to real-world client situations.

●           Over-reliance on technology: While financial planning software is essential, it cannot replace the ability to analyze complex financial scenarios, communicate effectively with clients, and navigate emotional conversations.

●           Lack of soft skills development: Many firms fail to teach essential skills like relationship-building, emotional intelligence, and client communication, leaving new advisors feeling unprepared and disconnected.

Without addressing these issues, firms are not just losing talent. They are failing to set the next generation of financial planners up for long-term success — and by proxy, furthering the talent shortage within the profession.

The case for industry-wide training initiatives

This is one of the many reasons I created The Externship, the only online training program for aspiring financial planners — and those who are curious about the profession. The Externship started as a solution to in-person internships lost during the 2020 pandemic shutdowns. But its asynchronous, virtual design worked well after in-person internships returned. Why?

It provides structured, real-world exposure to financial planning. The Externship prepares aspiring advisors for success before they ever step into a firm. Our 8-week program has proven to:

●           Expand access to the profession: We welcome students, career changers, returning professionals, and those who are simply curious about the profession, thereby increasing diversity in the profession.

●           Focus on competency-based training: While Externs learn the technical skills of planning and can access technology like eMoney, Orion, Asset Map, Encore Estates and Morningstar, they also learn how to think like a planner — not just how to follow processes.

●           Build new planner confidence through real client meetings: The Externship features real clients, their real meetings with a CFP® professional, and the real work of building a financial plan. This bridges the gap between knowledge and practical application.

●           Highlight diverse voices and experiences: Unlike training within one firm, The Externship supports diversity of thought by sharing other experts’ processes, resources, and experiences.

And the actual Externs agree.  

“I attended The Externship last summer and credit it with giving me the confidence to re-enter the workforce after an extended hiatus to raise my family. I know now that my life experience brings a lot to my work.” - Jane Ann Chrumka

“For years I have asked to be a fly on the wall in client meetings or better understand what it takes to service a client. The Externship has provided a way to see how to truly review a client’s situation. One summer in The Externship can be worth more than your first year at a firm.” − Tricia Prehle  

By making the real work of financial planning more accessible, and sharing input from dozens of experts, training programs like The Externship can help create a sustainable pipeline of new talent that is well-equipped for the realities of the profession.

A call to action for the profession

If financial planning is to remain a thriving and essential profession, we cannot afford to treat talent development as a firm-by-firm issue. The advisor shortage is an industry-wide challenge that requires an industry-wide solution.

To change our trajectory, firms must start prioritizing and investing in structured training programs that go beyond basic onboarding and actively develop the critical skills that new advisors need to succeed.

We must all must expand our recruitment efforts — and focus on attracting diverse talent, including career changers, parents returning to the workforce, and students who may not have previously considered financial planning as a career path.

So, what can you do?  I humbly request that leaders in financial planning actively support initiatives like The Externship, which provide accessible, high-quality training to aspiring advisors, at scale. Over 50 financial professionals come and share their knowledge inside The Externship each summer, and we have dozens of firms and Registered Programs sending interns and CFP® students through the program. What’s more, we’re attracting career changers and return-to-work parents who didn’t even know that this profession was available to them until they found our program.

If we can get more Registered Programs, more FinTech companies, more firms, and more associations to support initiatives such as The Externship, we will all win. We reduce barriers to entry, decrease “time to launch” for new planners, improve outcomes for firms and clients, and create a culture that not only expects excellence — but helps people craft it, as well. 

For more information about The Externship and how it can support incoming talent and new advisors,  visit www.theexternship.com

Hannah Moore is the owner of Amplified Planning and founder of The Externship.