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At FPA San Diego, Organization's Leadership Addresses Goals, Advocacy, Challenges

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The Financial Planning Association’s leadership met with members of the press in San Diego on Saturday for a frank discussion of the organization’s size, advocacy efforts and “second decade” initiatives.

Participants included 2011 Board of Directors Chairman Dr. Tom Potts, President Marty Kurtz, 2012 President-Elect Paul Auslander and FPA Executive Director and CEO Marv Tuttle.

Tuttle began by noting the success of FPA 2011 Experience, with 2,124 total attendees, including what he called a “significant” overseas contingent of 200 international planners.

He said the organization’s overall membership numbers are in a period of “good stability that is starting to see an uptick” following the “dark days” of declining membership in 2008-2009 which mirrored the recession.

“We have 23,800 members currently. We had 23,500 members at this time last year, so we’re moving in the right direction,” Tuttle said. “Our retention of existing members is also solid, between 75% and 80%.”

He noted other countries are beginning to recognize the need for a standard of care among their financial advisors, and are looking to the FPA for help in doing so; Ireland, Brazil and India were three countries he named, and he said it’s an opportunity for FPA to expand internationally.

He moved to a recap of the recent “major firms” conference the organization hosted the day before the start of the annual conference. The event attracted 93 representatives from 45 major financial services firms. FINRA head Richard “Rick” Ketchum was a guest speaker.

“We might not share similar views on a number of issues, but Ketchum extended his outreach and we gladly accepted,” Tuttle said. “It was a good opportunity for him to meet and interact with some of the senior executives at these major firms. He took hardnosed questions on technology and oversight.”

Turning to the state of the FPA, he noted the “competitive” environment for associations and non-profits. He mentioned a development study recently initiated by Marty Kurtz to help evaluate ways in which to reorganize and grow the organization. He said it is currently being performed and the results will be presented to the board in November with a planned implementation date of the beginning of 2012. Some of the ways that FPA can differentiate itself in this more competitive environment, said Tuttle, was to encourage more students to join FPA, to encourage diversity in its membership ranks and in the kinds of clients members serve and to increase its efforts in the academic community, in particular through encouraging and finding ways to fund “hard-core research.”

Speaking of the FPA’s advocacy efforts, Tuttle rhetorically asked how best to continue to build a presence in Washington.

“It’s not an area in which many of our members understand our potential impact,” he said. “Up until now we’ve been apolitical; I think we need to shed that a little bit. We have to get our voice heard.” 

In order to do so, he said he wants more from members than just their annual dues.

“Our focus is on having the SEC as the regulatory body for the financial planning profession,” he said. “They have a tough road to hoe. How would people in Congress make that happen, especially with Republicans struggling with the effectiveness of the SEC? Certainly oversight needs to improve and they should get the resources they need. We’ve been a vocal minority in advocating for that.”

He added that the Financial Planning Coalition (comprising the FPA, National Association of Personal Financial Advisors (NAPFA) and Certified Financial Planner Board of Standards) “led the charge for federal oversight of financial planners to be included in the Dodd-Frank financial reform act.”

“We didn’t get it in, but we got them interested in asking more questions about the financial planning community and what it does.”

Marty Kurtz then noted the rollout of FPA Connect, a new social media platform Kurtz says is similar to Facebook and LinkedIn.

“It’s a culmination of ‘how do we bring our community of communities together?’” Kurtz explained. “We wanted to do it for awhile, but the technology is now to a point where it is cost-effective. It’s an area where the owners of the CFP mark can come together for meaningful discussions with peers.”

He gave “Women in Finance” and “NexGen Impact” as examples of user groups currently in existence, taking on such issues as “Should a CFP be able to keep their designation in the event of a bankruptcy?”

“The methodology is one that goes from networking to joining communities of interest to building a system of influence in Washington, with advocacy and with fundraising,” Kurtz (left) said. “Compliance officers are asking about it, but because it’s not consumer-oriented, it goes a long way in making them feel more comfortable about having their advisors use it.”

Kurtz then noted the organization’s consumer initiatives, specifically naming Financial Planning Week and pro-bono efforts of Financial Planning Days, which provides free financial planning advice for those who need it. The latter is now in 30 cities and has the support of the Conference of Mayors, Tuttle said.

“It’s a good way for us to keep abreast of the issues consumers are dealing with,” he said. “For instance, last year it was all about mortgages and home values. And we’re able to break it out into different areas, meaning we can group it by subjects like credit, retirement, etc. Volunteers are required to attend a ‘boot camp’ for pro-bono training prior to volunteering.”

“We are losing the battle on the issue of life and money,” Kurtz added, echoing comments made in his speech at the opening of the conference. “Regardless of net worth and income, everyone needs a third party to help them deal with the issues of life and money. We’re just too wrapped up emotionally to do it on our own. That’s why Financial Planning Days is so important.”

In addition to the membership development study, Kurtz also mentioned an organizational review the FPA is undertaking, one that is “really about tearing the organization apart and looking at every aspect to identify where it can be better.”

Dr. Tom Potts then turned to a discussion of educational and scholarship outreach efforts to attract the next generation of advisors. He noted the Financial Planning Challenge, and contest involving case studies and a game show-style formats that tests students’ knowledge. Potts noted 15 teams participated this year, with nine teams advancing to San Diego.

“We also continue to encourage students to volunteer here at the conference,” Potts said. “The career opportunities are immense. Schools get more requests from companies for internship opportunities than are students to fill them.”

Part of the issue, said Potts (left), is that support is lacking for those individuals just starting out in the profession, where they are handed a book of prospects and told “they must kill what they eat.” Only when a system of support is in place will financial planning advance as a profession, Potts added.

He also said research will help advance the profession, noting recent whitepapers the organization has produced or sponsored on such topics as alternative investments and document imaging software.

 Auslander spoke last, saying he was very proud of the Financial Planning Coalition, and the influence they are able to have by combining membership numbers, which he says is something members like.

“We’d like to see financial planning federally regulated as a profession,” he said. That didn’t happen in Dodd-Frank, but that’s just how it is; sometimes you have to play the puck where it is, not where it’s going to be.”

He noted the high number of medical doctors and lawyers in Congress, but low number of financial planners trained to understand the profession and the financial issues with which individuals are dealing.

“There are good people in Congress, but they are not trained for that discussion,” Auslander said.

As a result, part of the organization’s “second decade” issues will involve more advocacy at the state level and more practice management initiatives.

“In the first decade of the organization’s existence, it was frankly often about Marv herding cats,” he said. “In the second decade, we want more boots on the ground at the state level. FPA is good at engaging on the local level through its 95 chapters, and it has the national organization, but it hasn’t until now engaged much with the various states. Also, we’ll do more in the area of practice management. How valuable can we really be if we don’t help our members stay in business?”


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