MIAMI -- The financial planning industry faces a number of major challenges -- and advisors are unhappy with the way industry groups are responding.
In a frank discussion at a town hall meeting, and in other sessions at the FPA Retreat here this weekend, planners voiced a number of complaints. Planners are fed up with confusion surrounding labels used to describe what they do, they said; they also faulted the FPA's inability to "draw a line" between planners and salespeople and the lack of support in hiring and integrating the next generation of planners.
At the town hall meeting, one statistic intended as a rallying cry -- the oft-cited need for 160,000 new advisors in the next decade -- became instead a focal point of advisors' frustration.
Veteran planner Dick Wagner of WorthLiving in Denver, Colo., told FPA board members on stage that the organization needed to stop "muddying the lines" between financial planners and other wealth managers. The number of "advisors" has no bearing on the number of "planners" in the industry, he argued.
WHO ARE WE?
Another well-known industry player chimed in. "Why do we not know our own numbers?" Michael Kitces, director of research for Pinnacle Advisory Group (and Financial Planning contributor), asked the board. "How many people actually practice financial planning?"
Kitces also pointed to the FPA's lack of enforcement regarding the standard of care planning members are supposed to adhere to.
Current FPA president Janet Stanzak told planners, "we are focused on being the home for the CFP professional, let me leave no doubt about that." Yet she acknowledged that the association has never enforced the fiduciary standard of care and that it has always been done in good faith.
That may not work so well in the future, Kitces warned: "If we don't enforce the standard of care we abide by, we're setting ourselves up for a big PR disaster down the road."
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