The Certified Financial Planner designation stands as a testament of one’s dedication to excellence and superiority in the world of financial planning. Or at least that’s what the CFP Board and the designees want you to believe. And they’ve done a good job convincing the world that CFP® holders are the wise wizards of the retail financial services industry.
Our personal experience, however, hasn’t quite match up with the marketing machine’s hype…
P-L-A-N-N-E-R spells Money Manager!
One of our most frustrating experiences with most CFP® holders has been their general lack of…well…planning. One would think that those who hold the emblazoned mark would be regularly and intimately engaged in the business of financial planning. But nothing could be further from the truth.
In fact, most of the CFP’s we run across are wildly more interested in commission or fee (a really sneaky word to conceal that you basically just work on commissions) based products. And while there is certainly nothing wrong with a business model that makes the vast majority of its income from commissions (I have one) it’s quite disingenuous to hold yourself out to the public as a “planner” and yet eschew the responsibilities or even the basic task of planning.
Instead we find most people who hold the designation are much happier gathering assets under management so they can collect commiss fees. And those fees roll in each quarter without one evening having to lift a finger—you can get paid and hangout on the golf course all at the same time.
It saddens me to admit it, but designations that exist in the financial services industry (all the letters that we see after someone’s name) are mostly marketing fluff. That’s not to say that these designations don’t offer some really good education to people, they do. But most agents/brokers/advisors/etc. don’t actually read through the material they are supposed to in order to complete the designation.
Instead they purchase the 100 or so dollar cram guide and memorize just enough to pass the test to “earn” the designation. As a former career insurance agent, I can tell you the industry is well aware of this. I was told to get my designations, because it would make people want to do business with me. Why? Because letters after anyone’s name are impressive and command attention. What those letters are and mean is of little if any importance.
And this shows…
We’ve met many highly…”credentialed”…individuals who laughably stumble through fairly simple financial planning concepts. From thinking that just because your income crosses a certain level within the six figures you should just magically buy whole life insurance instead of term insurance, to believing that just because you are married, you automatically get double the estate tax exemption just yourself…sad.
So why am I a Student at the American College
As I write this I’m a matriculated student at the American College of Financial Services. I have been for a while now, and really need to get back to my Chartered Life Underwriter course work before their five year rule makes the money I spent a total waste of time—I’m busy and I refuse to buy the cram guides.
And get this, one day I’ll probably challenge the CFP exam and become a charter holder—if the CFP Board will let me in after I bad mouth the designation : D
I believe in education and I think everyone benefits from striving for as much new perspective and education as possible. Ultimately, it’s all about what you make of it. If practitioners within this industry choose to acquire a designation solely to say they have one in an attempt to trick people into trusting them more, that’s their loss. Unfortunately is can hurt innocent consumers, but there are a lot of other things out there that can hurt them as well.
My point in all of this is very simple. Don’t allow yourself to be wooed by a designation. These things are, unfortunately, not all that costly to fake and everyone needs to be much more skeptical of the advice and guidance they seek from agents/brokers/advisors. Regretfully the certified financial planner designation does not guarantee an awesome practitioner.