CFP numbers falling despite higher salaries, fees

by |

The Financial Planning Standards Board (FPSB), owner of the international Certified Financial Planner certification program, reported that the global number of CFP professionals grew by more than 8,000 last year, from 139,818 in December 2011 to 147,822 in December 2012. But Australia has bucked the trend, with the number of CFPs in the country dropping from 5,492 to 5,473.

FPA CEO Mark Rantall says it is the country’s ageing population that is causing the downward trend, and enrolments for the CFP certification program, which is the highest level of certification a financial planner can achieve, have actually seen a 20% increase. However, due to retirements and the duration of the course, it will take time before these numbers are reflected in Australia’s CFP population.  

So why is CFP certification beneficial to you?

According to Investment Trends reports last year, CFP professionals are not only more likely to be hired, but also to be paid more and be seen as less of a compliance risk. The reports showed:

  • Consumers who use (or express a preference to use) CFP practitioners were willing to pay 28% more for financial advice.
  • Seventy-five percent of planner licensees said they would pay up to $40,000 per annum more for planners with a CFP designation.
  • Forty-four percent of planner licensees said their practice would favour a CFP practitioner when it came to employing a new planner.

A Comparator Benchmarking report also shows:

  • Fifty-seven percent of licensees report that business revenue increased as a result of employing CFP professionals.
  • Sixty-five percent of licensees claim that client relationships are strengthened by having a greater number of CFP practitioners.
  • Seventy-eight percent of licensees state that corporate risk and complaints are reduced by having a greater number of CFP practitioners.

According to FPA and ASIC data, CFP professionals account for more than 35% of the planner population but less than 2% of ASIC enforcement activity.

More stories:

ASIC accepts enforceable undertaking from Macquarie Equities

ASIC issues warning after unveiling new FDS guidelines

Planners: beware of licensee requirements