by Dan Moisand, CFP®
Dan Moisand, CFP®, has been a practicing financial planner since 1991. He is a principal at Moisand Fitzgerald Tamayo LLC in Melbourne, Florida, and former president of the Financial Planning Association.
My 25th high school reunion is coming up in two weeks. As my wife and I (we were high school sweethearts) have reconnected with classmates in anticipation of seeing one another, I am struck by how different some of our Satellite High alum are from 1985. My, how things can change. Burnouts and basket-cases have made wonderful lives, while some contenders for Most Likely to Succeed are a mess. All of us Scorpions are different in some way, and not just in our waistlines. Change is simply a fact of life personally and professionally.
I got into financial planning as soon as I got out of college. The landscape of the profession bears little resemblance to what exists now. Then, the closest thing to a financial planning firm in most of the country was IDS. When I would tell people I was a financial planner, many would respond, “I don’t want any insurance.”
Today, somehow, my name is on the door. We have three staff members who came to work at our firm straight out of college with no expectation from us that they bring in new clients. One of them has a degree, an honest to goodness degree, in financial planning from Purdue University. That’s a real school, folks. When I tell people I am a financial planner, they often ask questions covering a wide variety of subject areas. Sure, too many still ask for a stock tip, but there is progress nonetheless.
Then and Now
In the aftermath of 2008, the winds of change have been blowing for financial planners. Financial reform efforts have been all over the map. Every other day for months now, the story seems to change. Fiduciary duty is coming for all who give advice, then fiduciary is dead. Nope, it is back, then gone. Financial planners will come under a new government agency, CFPA. Then there isn’t supposed to be a CFPA, followed by its return.
While all this was going on, we would hear about the Financial Planning Coalition. A few thought it was horrible that CFP Board, Financial Planning Association, and National Association of Personal Financial Advisors would ever speak to each other, let alone agree with each other about anything. Others thought the Coalition’s efforts to influence legislation were misplaced or a waste of time, but really, given the history, the idea that these groups would be in an active collaboration would have sounded miraculous not that long ago. I hear echoes of Lou Garday’s ramblings about 501(c)3 vs. 501(c)6 organizations in my head as I write this.
Sadly, no sooner had the Coalition started to talk about proper regulation of planners before critics invoked the ghosts of CFP Lite. At the time CFP Lite was unveiled, I served on the Board of Practice Standards. As a member of that sub-board, I got a whole day’s advance notice before the unveiling. I wasn’t consulted, I felt betrayed, and like many others, I was angry.
Some of the criticism of that initiative was on the worthiness of the concept, but most of the protest was a reaction to the process and the lack of practitioner input in that process. Theories and rumors spread quickly about the motives of the staff and Board of Governors. CFP Board’s standing among practitioners took a significant hit.
In the coming years, they struggled to overcome this wound to their credibility among planners. The series of CEOs that followed did not help their cause, but things change. In my opinion, it is time to move on from that past. For Pete’s sake. It has been over a decade already. Let it go. Please.
Between Sara Teslik’s mass firings and the move to Washington, D.C., I am not sure there are any employees at CFP Board who were present for CFP Lite. Of the current members that I know of the Board of Directors and the various councils, commissions, and task forces, I cannot think of a single person who was a proponent of CFP Lite. None.
Getting Over It, Already
I am in no way suggesting CFP Board get a free pass and we just assume everything they do will be wonderful. Nor should FPA or NAPFA be exempted from review and constructive criticism. However, I would like to see more of a couple of things with respect to the Coalition.
First, is an assumption of good intent. When one assumes good intent, rather than creating stories about another’s motivations, the conversation can more quickly focus on the merits of an idea or its implementation. Further, when disagreements arise, attention can turn more quickly toward collaborating on a resolution.
Try it for yourself. Pick a person with whom you wish to have a better relationship and for the next week, assume they have good intent whenever they speak, no matter what they say or how they say it. While this will not be easy at times, you will likely find that you respond to them differently, and positively, and in turn, they respond in kind. Give the Coalition this slack. They deserve it and I will tell you why in a minute.
I’m not sure which is worse, blasting away at those trying to deal with issues that face the profession or ignoring the issues entirely. The second thing I would like to see more of is engagement. The financial planning profession has been blessed with constituents that have been championing the profession, but more voices are needed.
One of the recurring criticisms of CFP Board since CFP Lite has been that they operate behind closed doors. Much of the criticism was justified. I wonder, though, what CFP Board thinks, after getting so much grief for a lack of openness, when they put something out for public comment and almost no one comments? I hope they’ll ask for more comment on more issues despite the response rate.
As of this writing, the financial reform bill was not complete. Based on what I can see at the moment, I will likely view the final product as a mix of good things, bad things, and puzzling things. My eyes roll seeing language calling for the SEC to conduct yet another study to ascertain consumer confusion and giving the SEC a green light to make new rules regarding the delivery of advice and the imposition of a fiduciary duty. The track record of the SEC in this regard is not good. Who knows what would come from that.
Yes, I realize the prior paragraph doesn’t seem to contain much of an assumption on my part of good intent. I told you it was tough sometimes. It also points out that the profession needs an advocate even after reform. Issues will remain and new ones will arise. Change is a constant.
Change for the Future
This is one reason why we need FPA and the Coalition. Financial planning, financial planners, and planning clients need advocacy. As flawed as these organizations have been, are today, and will be tomorrow, we need them and they need our constructive criticism. It is a wonderful change to see these groups collaborating, and we should benefit from their consumer efforts as well as forays into professional issues.
They also deserve our respect because they have made a difference. Much will be made in our circles about what didn’t come to be in the financial reform package. Someone will surely belittle the Coalition for “failing” in its advocacy efforts. Maybe the fiduciary language will be knocked. Almost surely someone will take the Coalition to task over the financial planning regulatory structure that didn’t make it to the bill. There will be at least some truth to these criticisms. There is truth in most criticisms if you look for it. That is beside the point.
Please don’t lose sight of the fact that a U.S. senator drafted legislation to create an appropriate regulatory structure for financial planning, or that the President of the United States called for a fiduciary duty for all who give advice, or that Congress sifted through several proposals for what that fiduciary language should say. People—that’s the president and the Congress we are talking about!
When I started out, that was part of the vision of a handful of forward-thinking practitioners that many others labeled a pipe dream. By the time FPA was formed a decade ago, more people had adopted the vision of a profession, but only a little progress had been made. No money, no connections, no chance.
Well look what the little ’ole planning community has managed to accomplish. We successfully sued the government and subsequently got the issue of standards on the table. Sure, what comes out of Washington isn’t perfect, it may even be a step backwards in spots, but don’t let anyone convince you the Coalition’s efforts are failures either. There are decision-makers in Washington, D.C., not just taking our calls but taking meetings and actually listening to what planners have to say, and yes, quite a few members of Congress truly “get it.”
Even after whatever ends up in the reform package becomes law, the Coalition will need feedback from members and practitioners. When they have a webinar, listen in. If your schedule conflicts, make time to listen to a replay. When they have a town hall meeting, attend. When you get a survey, complete it. When they solicit volunteers, consider stepping up. When they seek comment, speak up. Challenge their ideas. We’ll all be better off for it.
Change is inevitable. Thank goodness. Otherwise, most of my clothes would still have Scorpion logos on them. Now, I wouldn’t mind getting closer to my old weight, but I suspect that may just be a pipe dream.
