The Certified Financial Planner Board of Standards wants to nearly double annual fees for its members to support a marketing initiative to increase public awareness.
The board wants to increase fees 80% annually to $324, Kevin Keller, its chief executive officer, announced during an update on CFP Board activities at the Financial Planning Association's Annual Conference in Denver. Currently, certified financial planners (CFPs) pay dues biennially. If the measure is approved by the CFP Board in November, Bob Glovsky, the organization's chairman, said the increase in fees could be implemented by July 1.
"CFPs are invoiced once every other year," Glovsky said. "We are hoping they will see the results before they feel an impact."
The CFP Board plans to use the $9 million in additional funds to pay for an aggressive public awareness campaign. It has selected Arnold Advertising, the sixth largest advertising agency nationally that boasts clients such as Fidelity, USA Today and McDonald's, to run the campaign.
The campaign would be designed to target mass affluent "validators," who are "optimistic, future-oriented" investors, Keller said. The campaign would include an updated Website and online advertisements, he said. It would also include some social media marketing.
"To increase consumer awareness of, preference for and use of CFP professionals, we need to make an investment of time, energy and resources," Glovksy said. "From listening to my fellow CFP professionals, it's clear that they understand this and are willing to do their part."
According to a survey of 7,200 CFPs conducted by the CFP Board, 94% of planners say that improving public awareness is critical. Keller said that currently there is an "alphabet soup of designations," and consumer research indicates the public is confused.
The organization has not increased fees since 2005.
Keller said he has made 13 or 14 presentations nationally and the board has conducted a direct mailing campaign to let CFPs know about the new campaign.
Glovsky said the board has $25 million and plans to use $6 million of its reserve to get the campaign started. He said it "wouldn't be prudent" to use all of the reserve for a marketing initiative.
Glovsky said if the fee increase is approved, he expects the CFP Board would begin collecting dues annually rather than biannually. According to a survey of CFPs, only 12% want to pay fees biannually.
Check out the CFP Board's response to some of the criticism they've received on our discussion boards as a result of news of this fee increase.