Practitioners and Academics Unite for Research

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One of the hot topics at this year’s Academy of Financial Services (AFS)  conference—running in conjunction with FPA Denver 2010—is how planners and academics can work together to build the body of knowledge around financial planning with more empirical research. A panel of practitioners, including Harold Evensky, CFP®; Guy Cumbie, CFP®; Ruth Lytton, Ph.D.; and Dave Yeske, Ph.D., CFP®; moderated by Stuart Michelson, Ph.D., urged academics to get a better idea of the work financial planners actually do, to better propose research of lasting value to practitioners. They also suggested planners and academics could be natural partners in conducting research.

The panel was followed by a luncheon, at which Yeske delivered the keynote address. He talked about his journey from practitioner to more serious academic, and how his academic studies have made him a stronger planner. He talked about the need for evidence-based planning, the kind of financial planning that is grounded in empirical research, carefully evaluated and implemented by planners who have taken the time to understand the difference between well conducted, helpful studies and subjective, agenda-driven research. “Planners know what the compelling questions are, and academics know how to conduct the kinds of research that will answer them,” he said.

Yeske and Becca King, manager of the FPA Research Center, announced the formation of an FPA community of interest to bring together planners and academics to conduct research based on planner suggestions and academic study. In addition, they invited academics to work with the FPA Research Center to conduct conditional research.

Mary Corbin
Senior Editor, Journal of Financial Planning
Managing Editor, FPA Press
Financial Planning Association

One thought on “Practitioners and Academics Unite for Research

  1. Academics face a difficult situation. To be respected in academia–and to earn tenure–they are under pressure to publish in top-tier academic journals (the ones that practitioners probably don’t read). Very little credence is given to industry publications, so they are typically not the targeted outlet for the academic seeking tenure.

    Ideally, academic researchers should understand the issues that practitioners deal with, and the research questions most in need of answers. These questions would lead to the collection of appropriate data, and ultimately–it is hoped–to some conclusive research results that can then be implemented by the practitioners.

    However, in practice, academic research does not always work that way. Often the most readily available data is used for purposes of increasing productivity; and research questions are chosen based on the type of data available, rather than by the needs of the profession. It is sad but true that what is valued in the halls of academia is not always valued by practitioners, and vice versa.

    Coming from a military background (I am a former Marine) I have always felt it was important to “spend time in the trenches” so to speak. When I was making the choice of directly pursuing an academic career (I am one of the first two graduates with a PhD in personal financial planning) or spending some time in practice first, I was discouraged by several well-respected academics from taking the practice route. I thought that a few years in practice would improve my understanding of the profession and help me generate relevant research. My mentors told me that spending time in industry would lower my academic standing and “taint” my academic reputation. One colleague related it to “losing your virginity.”

    Clearly, the divide between academia and industry needs to be closed. But it needs to be done in a way that will not “taint” the reputations of the academics that we depend on for quality research. For years Jeff Lambert and I have talked about the idea of creating a program for faculty internships which would give academics the opportunity to spend a summer working in a planning firm side-by-side with experienced planners. This would help them see what it is like working in the trenches, and would expose them to the issues that need further research. For a program like this to work, funding would be needed to cover travel and living expenses, as well as stipends for the academics (who would be giving up the opportunity to teach over the summer). Such a program would also require a group of seasoned practitioners who are willing and anxious to welcome academics into their practices for the summer, and who will openly exchange research ideas. I see this type of program as a real possibility. We have an amazing community within the financial planning profession. All we need is a company to step forward with funding and champion the cause.

    By the way, regardless of the effect on my reputation I decided to spend some time in practice. Call me a rebel if you will. I prefer to think of myself as a revolutionary.

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