From A Key Vantage Point For Observing Financial Advice Professionals, IMCA CEO Analyzes The Difficult Issues Facing Advisors

Thursday, April 11, 2013 11:03
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From A Key Vantage Point For Observing Financial Advice Professionals, IMCA CEO Analyzes The Difficult Issues Facing Advisors

The financial advice business is comprised of fragmented professional groups that don’t know each other very well, which is making for an awkward coming together being foisted on them by market forces. For example, the large body of knowledge from the American College, which has its roots in the insurance business, is largely unexploited by Certified Public Accountants who hold the Personal Financial Specialist (CPA/PFS) designation, yet CPA/PFSs, CLUs, and ChFCs all advise on estate planning strategies. Certified Financial Planners have a body of professional knowledge distinct from Chartered Financial Analysts, yet they both make their living principally by charging for investment advice. All of these professional groups are converging but are not very good at talking to each other about it.
 

Point is, cross-pollination of ideas among financial advisor professional groups is mmore important than ever because the business and profession has just come through the financial crisis, which has enormous regulatory changes at a time of technology and communication unpheaval.

 

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While more knowledge-sharing across different segments of the financial advice profession would be beneficial to advisors and consumers, the different provinces of the financial advice business are fiefdoms. AICPA, CFP Board, IMCA, CFA Institute, American College each has its own governing body, staff and bureaucracy, and political dynamic. Each fiefdom would say it provides the best designation for consumers seeking financial advice, which arguably keeps them fragmented.

Sean Walters, CEO of Investment Management Consultants Association, sits atop one of the most strategically situated vantage points for observing the profession, and he’s talking about the challenges and crosscurrents he sees at an A4A webinar tomorrow at 4 ET. IMCA serves a diverse membership: 29% of its members are CFPs, 9% are CPAs, 5% are ChFCs, 2% are CFAs, 11% are CPWAs and 79% are CIMAs.

Walters says investors trust advisors less, but expect more. Meanwhile, government regulation is adding to the burden on RIAs and broker/dealers, as rules slowly coming down from the Dodd-Frank Act are being implemented. The competitive dynamic advisors face is shifting while the movement to make the financial advice business a profession is being reshaped. To understand what’s going on, join us for this session.

 


 

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