Independent research demonstrates that working with a Certified Financial Planner adds significant value to one’s financial planning journey.


What’s the value of hiring a CFP?

The planning profession’s largest certification correlates with good grades from clients, both in terms of important wealth management outcomes and satisfaction with their financial advisors.

Certified financial planners draw significantly stronger scores from their customers than those using a non-CFP advisor or none at all, according to last month’s release of the results from the second year of the CFP Board’s ongoing study, which the organization describes as “the first comprehensive academic study to track and report the actual impact of holistic financial planning on clients.” The research adds to growing literature on the numeric value of quality financial advice and how to communicate that value to clients and prospective customers. The CFP Board’s study examines planning outcomes over at least a decade — a miniature and profession-focused version of the famed Harvard University study of happiness over 85 years.

At least 73% of the clients of CFPs said they have “strong trust” in their planner, but only 52% of the non-CFP advised customers said they had the same level of faith in their advisor. Nearly two-thirds of the CFP-advised clients said they were “very satisfied,” compared to 44% of those using non-CFP advisors. And CFP-advised clients surpassed their counterparts with non-certified planners by more than 20 percentage points when asked if their advisors reduce financial anxiety and motivate them toward long-term planning goals. The research could influence advisors’ professional development choices on obtaining certifications, marketing efforts with prospective clients and, perhaps most significantly, the value of full-bore planning.

To Matt Regan, the president of Richmond, Virginia-based independent advisor services and registered investment advisory firm Wealthcare, the results were compelling but “shouldn’t surprise anyone” when considering the question of whether comprehensive wealth management “is a better mousetrap.” Talking to clients about their lives, goals and risk tolerance simply yields better value to clients than talking about what stocks to pick in the course of a jargon-filled lecture, Regan said.

“A lot of this has been around for a long long time, but the reality is that we’re still moving away from the investment-only guys,” he said. “There are more of them out there than you may think.”

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