The Value of CFP Certification to Female Advisers

Kevin Keller, CEO of CFP Board, discusses the key findings from Aite Group's recent research report, Building a Diverse Practice: The Value of CFP Certification to Female Advisors.
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If ever you doubted the value of a CFP certification for women, doubt no more.

Recent research from Aite Group that was commissioned by CFP Board bears that out.

In an interview, Kevin Keller, the CEO of CFP Board, discussed the report, Building a Diverse Practice: The Value of CFP Certification to Female Advisors, and its implications.

Among the key findings:

· Women are particularly invested in the financial planning process, said Keller. For instance, a third of female CFP professionals provide written financial plans to three-quarters or more of their clients, while 22% of male CFP professionals do the same.

· Female CFP professionals provide comprehensive plans to almost twice the share of clients as other female advisors and 10% more clients compared to male CFP professionals. On average, female CFP professionals provide comprehensive financial plans to 34% of clients, while male CFP professionals deliver comprehensive plans to 23% of clients. “So, we really see females gravitating (toward) and demonstrating deeper and broader adoption of financial planning within their firms,” said Keller.

· Female CFP professionals present themselves as highly confident advisers with strong satisfaction in their ability to build client trust and provide financial planning. For his part, Mark Tibergien, chair the Work Force Development Advisory Group for the CFP Board Center for Financial Planning, said “we have learned from other studies that at some point over the life of a client relationship, women will ultimately assume primary responsibility for managing the family’s financial decisions,” he said. “I don’t want to state unequivocally that men cannot be empathetic and helpful in such circumstances, but there often is a higher level of engagement when women take the lead in advising without ‘mansplaining.’”

· Female CFP professionals were more likely to state that they are very satisfied with the following practice characteristic: approach to financial planning (49% versus 34% for male CFP professionals). And that, said Keller, is a finding perhaps runs counter to what most people would normally expect.

· Female CFP professionals are also more satisfied with their careers than other female advisers. According to Keller, that finding might have to do with the way CFP professionals approach financial planning, in a holistic manner. And Tibergien had this insight: “Throughout a person’s career, high performers in any business are able to advance further with greater fulfillment when they continue to learn and develop their skills,” he said. “Obtaining the CFP is not just buying a license to advise clients. It’s an effective process for elevating one’s skill set based on the lessons of their industry predecessors and well-researched theory and practice developed by well-educated academicians.”

Anthea Perkinson, a principal with Monterey Associates and director of Money Made Simple, was not surprised to learn from this study that female advisors holding the CFP designation are invested in the financial planning process and more likely to provide written, comprehensive financial plans.

“The CFP education program provides discrete topics on which to engage clients,” she said. “These topics easily lend themselves to a roadmap or process for engaging clients in constructive conversations that can uncover the emotions, psychology and values behind the money.”

And having a framework to guide this exploration, Perkinson said, is confidence-boosting and reaching clients “where they live” increases the likelihood that the planning advice will be followed and will affect client outcomes.

Perkinson also agreed that helping clients create a picture of where they want to go and then build a plan for them to get there, action item by action item, is extremely satisfying work. “I derive a lot of psychic benefit---happiness, even--- from watching clients achieve their goals of eliminating debt, buying homes, expanding their families, retiring early, etc.,” she said.

Need for more female CFP professionals

The study also uncovered an urgent need for firms to recruit more client-facing female advisors who are CFP professionals. Among other things, firms need to address the barriers that females face in becoming a CFP professional. Female, for instance, the time and flexibility it takes to complete the CFP certification’s educational requirement and prepare for the exam, said Keller.

For his part, Tibergien said one thing the study highlights is that financial planning is a compelling career choice for women. “The benefits that obtaining CFP certification provides them is refinement of their practice and more structure around the discipline of financial advice,” he said.

It’s also widely known that many more women are achieving financial success in their own right so having diversity in the ranks of financial planners gives people more choices from whom they might seek guidance, said Tibergien. “Add to that proper credentialing, and it puts women advisers on par if not at an advantage to many of their male counterparts and competitors,” he said.

According to Perkinson, most of her closest financial planning colleagues are career changers and they have talked about the benefit of the CFP education program in filling their knowledge gaps as they transitioned from other jobs, mostly in financial services. “Gaining CFP certification was critical to feeling qualified to present myself to prospective clients when I first got started, but there is always more to learn,” she said. “Recently, I had an interesting conversation with my former college roommate, a licensed clinical social worker, who observed that I am probably doing more actual social work than she is in her current job. That’s given me a lot to think about.”