CFP Board’s Evolution Advances the Financial Planning Profession

CFP Board recently shared the news that we established a new 501(c)(6) nonprofit professional organization. With this change, we will operate two affiliated organizations, both of which are focused on achieving CFP Board’s Strategic Priorities. The 501(c)(6) organization will be called CFP Board of Standards, and the 501(c)(3) organization will be called CFP Board Center for Financial Planning.

One of the top questions we’ve been asked since our announcement is why we’re making this change.

Imagine you’re trying to sell a new, energy-efficient appliance to a family. You can tell them what it does, that it’s safe and it’s a great value — but that’s it. You can’t tell them how it will improve their quality of life, how much money they’ll save in the long term, or how it compares to other products. You can’t even directly ask them to buy the appliance.

This hypothetical situation illustrates a challenge that CFP Board has repeatedly encountered as we work to promote financial planning careers to students, communicate the value of CFP? certification to advisors and their firms, and convey to investors why they should hire a CFP? professional.

As a 501(c)(3) organization, CFP Board has been limited in what we can say about the benefits of financial planning careers and CFP? certification. Our focus has always been on benefits to the public — but we could not discuss the benefits of CFP? certification for individual advisors. We couldn’t even say something as simple as “obtaining CFP? certification will help advance your career.”

How can we attract enough next-generation talent to grow the number of competent and ethical financial planners if we can’t talk about the benefits of the individual and the profession?

Now, as a 501(c)(6), our communications and marketing can be broader and more direct. We can have candid conversations about what it means to be a CFP? professional. We can talk with students, career-changers and even those who work within our profession but are not yet certified about the many opportunities of this rewarding career. We can now talk specifically about typical pay scales, for example, and how CFP? certification impacts your earning potential and opportunities for advancement.

This new tax status also enables us to expand our marketing of CFP? certification to consumers. Marketing efforts to date have largely focused on raising awareness of CFP? certification among the public. Now, we can also work on increasing consumers’ preference for CFP? certification, and we can be more direct in telling people to find or hire a CFP? professional.

To be clear, the public benefit of CFP Board’s work remains paramount, and we will continue to operate in the public interest. But now we have more opportunities to take actions that advance the financial planning profession — and that help advance a CFP? professional’s career.

This evolution will help us achieve our Strategic Priorities, specifically the Access, Awareness and Workforce components. Our overarching goal is to significantly impact the profession's future and meet the growing public demand for competent and ethical financial planners.

We expect this change will have little impact on the way CFP? professionals and others interact with CFP Board. It will not change the CFP? certification requirements or our work to set and enforce the CFP? certification standards. Our current Board of Directors will remain in place and provide the same leadership for both the 501(c)(3) and the 501(c)(6) organizations. And I will continue to be the CEO of CFP Board, ensuring that we align the resources of both organizations to achieve the priorities set by the Board of Directors.

We are not establishing a traditional membership association for financial planners, creating member communities or chapters, publishing a member magazine, or providing affinity marketing or practice support services. Let’s leave that to the traditional membership organizations that are already doing that: FPA and NAPFA.

The bottom line: This evolution is all about workforce development.

Strengthening the financial planning workforce will benefit everyone in the profession and will help generate future talent. And greater awareness of what financial planning careers involve will help establish financial planning as a recognized and respected profession.

We are excited about this change, and we look forward to continuing our work together to achieve CFP Board's Strategic Priorities and advance the profession for the benefit of the public.