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A decade ago, Kurt Rosentreter had five investment advisors on his team who also constructed financial plans. Today, his team members’ titles look a little different. His team now has five wealth managers and also recently hired a dedicated financial planning specialist.
“We’ve fine-tuned as we’ve grown to take on more expertise just in broader planning, and for the first time, have now hired a specialist because there’s so much work in that space,” says Mr. Rosentreter, portfolio manager with Manulife Securities Inc. and president of Upper Canada Capital Inc. in Toronto.
As clients increasingly seek financial advice and planning support for a wide range of life concerns such as supporting children’s post-secondary education, planning for a sabbatical, sustaining their lifestyle in retirement, leaving a legacy for their children and grandchildren, and more – some advisors say they’re shifting their hiring strategies to bring on more certified financial planners (CFPs).
“In the past, the focus and emphasis were often more on investment advice, and now it’s become a more comprehensive and integrated financial planning approach,” Mr. Rosentreter says, adding he has always considered financial planning as part of his practice.
Maili Wong, senior wealth advisor and senior portfolio manager with The Wong Group at Wellington-Altus Private Wealth Inc. in Vancouver, says she believes the value of the CFP designation – and the rigour involved behind qualifying for and maintaining it – has “really increased” over the past few years as the pandemic prompted clients to seek out advice on a broader range of financial concerns. Those reasons are why Ms. Wong has brought more CFPs into her practice.
“The value of advice around planning and holistically having the ability both to solve issues from an investment standpoint but also look at how the investments relate to the actual [financial plan] is the priority for clients,” she says.
There are approximately 17,000 CFPs across the country, according to FP Canada. Candidates complete an education program and pass a national exam to qualify. In April 2022, the certification and oversight organization’s new rule requiring those applying for the designation to have at least a three-year bachelor’s degree came into effect. In July 2022, FP Canada began allowing individuals without a post-secondary degree to qualify for CFP certification if they’ve been a qualified associate financial planner for five years and completed the certification bridge path to CFP certification or had 10 years of qualifying work experience.
Once certified, CFPs must complete 25 hours of continuing education annually, including two hours of education on professional responsibility.
The evolution of the industry
Ms. Wong believes having more CFPs on staff allows her to offer better services to clients by developing comprehensive financial plans and calibrating their investment plans to meet those goals. Her practice also uses technology enabled by artificial intelligence to run simulations for clients that show them the impact of choices they make on their long-term financial goals, as well as the impact of their investments on their financial plans.
This approach reflects a broader evolution in the financial services industry, she says.
“You’re able to develop a meaningful plan that’s a living and breathing document that investment advisors can then implement through a very sound investment strategy,” she says.
“It’s important to have both, and I think that’s the difference. In the old days, it was just about investing and letting growth work for you and hopefully, everything will pan out.”
Building trust with clients
An-Lap Vo-Dignard, senior wealth advisor and portfolio manager with Vo-Dignard Provost Wealth Management Group at National Bank Financial Wealth Management in Montreal, says having a dedicated CFP is also an important part of building stronger relationships with clients.
While the investment dealer has financial planners and estate planners available for advisors, his team opted to bring a dedicated financial planner onto the team. Mr. Vo-Dignard says his team found the firm’s financial planners were often overwhelmed, which created delays and unnecessary back-and-forth if clients were missing small pieces of information.
“Having someone on our team, it’s quicker, smoother, and it builds trust [with clients],” Mr. Vo-Dignard says, adding that clients appreciate working with someone who knows and remembers their life circumstances, and checks in with them. “It adds value.”
Mr. Rosentreter says investment dealers and financial institutions have historically been light on financial planning support, and it has been up to individual advisors to determine what they want to do on a practice level.
“The research continues to show clients want more than just investment advice,” he says. “If financial firms and practices aren’t on the bandwagon, they need to get there.”
He believes advisors who provide investment advice exclusively will find themselves struggling to compete for new clients and retain existing ones.
“Investment-only advice … has almost become a commodity. ‘Who can get you better returns’ is a slippery slope and every advisor knows it,” he says. “The value-add is service and broader advice tied to goals.”
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