As an internationally recognised mark and the highest professional designation that can be given to a financial planner, Certified Financial Planners (CFPs) are expected to have extensive industry experience and to have completed rigorous study, well above minimum standards.
TheFinancial Planning Association(FPA) established the CFP Professional Education Program in Australia and as such, has a hold on the designation and heavily endorses it as the premium planner qualification. One of the requirements of holding the CFP designation is that you must be a member of the FPA.
The FPA expects CFPs to be regarded as the pick of the financial planning crop, but does the rest of the industry hold the mark in such regard, and which dealer groups do the CFPs go to?
In the past year, just over 2,900 CFPs were working for the Top 100 dealer groups. With about 14,338 financial planners working in total in this league, this equates to around only 20 per cent.
The current number of CFPs is almost 5,000, which leaves 2,100 other CFPs who have either not been disclosed in the listing, or who are working outside the Top 100 dealer groups.
FPA general manager education business services Chris McMillan says this figure makes sense as a lot of the boutique groups have one or two CFPs working together.
“Many of the boutiques are made up of a few CFPs who have left the big end of town to set up their own practices, because that’s the next step in their career progression,” McMillan says.
Interestingly, not one of the dealer groups in the Top 100 league has planners who are all CFP qualified. While McMillan says the number of CFPs is growing steadily every year (4.7 per cent in the last year),Integratecmanaging director John Prowse can’t see a massive influx of the mark in the near future, and more to the point, doesn’t think it is a problem.
“We won’t reach a stage too soon where advisers will aspire to be a CFP, but it’s a matter of what is an appropriate number [to be qualified in the industry] — and I doubt that is everybody,” he says.
“In the community as a whole the majority of financial planning problems are fairly straight forward — based around things like saving money for retirement, making sure your clients have insurance coverage and maximising social security benefits.
“The material to deliver good quality advice for ordinary needs is met in the ordinary DFP and the advanced DFP.”
Prowse says while the option of then going onto the CFP designation or a masters degree is there, people are seeing them as an ‘either or’.
“I don’t think many would be looking to both, and there are plenty of masters degrees around now. Many people prefer masters degrees for the prestige of having a university degree,” Prowse says.
“The bigger question should be the numbers who actually have the diploma and the advanced diploma — that is of more concern. Let’s get everybody to advanced diploma first and then worry about who continues.”
Of those who disclosed CFP numbers,AMPrecorded the highest number with 431 out of 1433, followed by PIS with 140 out of 1309 andGarvanwith 133 out of 431. However, these are groups with high planner numbers, so higher CFP numbers are to be expected. Groups with a high ratio of CFPs to planners were Clearview Retirement Solutions,State Super,Mercer,QinvestandIpac Securities. Other groups includeBDO Kendalls Financial Planning,Western Pacific Portfolio Planning,Centrestone Wealth Advisory,Swanton and Davidson,Were Strategic PlanningandGodfrey Pembroke. The hypothesis that CFPs are attracted to boutique or smaller dealer groups is supported by these figures, which show that of all the dealer groups in the Top 100, the groups with the highest rations of CFPs all had less than 100 planners. The one exception was Godfrey Pembroke with 128 CFPs out of 182 planners.
