FPA of MN Newsletter – October 2016
President’s Message – October, 2016
Greetings to all,
At our Strategic Planning Day last fall I encouraged the chapter volunteers to think about “impact” as we planned for our year ahead and beyond. There are three areas I wanted us to keep in mind specifically: members, community and profession. In the month ahead there are to opportunities for us to share in making an impact.
Impact on one another and our clients: FPA of Minnesota Symposium
Regarded as one of the best financial planning conferences in the country, Symposium will take place on October 10th and 11th at the Minneapolis Convention Center. The event again features an outstanding lineup of speakers bringing great opportunities for continuing education credits; CFP® Board CE, NASBA/CPA, CIMA, CLE, and MN & WI insurance CE credit will be available, including ethics. There will be plenty of opportunities for networking with financial planners and industry partners. We anticipate having over 625 attendees this year! You will absolutely come away with great takeaways that will help to better serve clients as well as deepen connections with colleagues in our financial planning community. To register, visit the Symposium website.
Impact on our community: Financial Planning Day
The 7th annual Twin Cities Financial Planning Day will be held on Saturday, October 29th from 10:00 am – 2:00 pm at the Wilder Center in St. Paul. This event serves as an opportunity to increase the recognition and value of financial planning in the Twin Cities area and provide the public with the financial information they need. Planners can volunteer to meet one-on-one with participants to answer their financial questions. The event will also feature a series of 50-minute educational workshops and a resource fair where local non-profits will spread awareness of the resources and services available within the community to program attendees. This year’s event will feature Nathan Dungan (Share Save Spend®) as the keynote speaker. To register to volunteer for this year’s event or for more information, please visit the Financial Planning Day website. I can’t sing the praises for the event loud enough, I encourage you to participate.
Impact on the profession: Media Training
FPA has a wonderful connection to the media with a system bringing professionals to journalists. Any FPA member who is also a CFP® professional can be part of FPA MediaSource – the automated media query system that sends reporter queries to qualified financial planners. While media training is mandatory for all CFP® members who want to receive FPA media queries, the information will enable you to effectively approach media relations within your own business!There are complimentary, all-member virtual media trainings offered regularly.Become a "go to" source for journalists looking for information and commentary on personal finance, financial planning and the profession! As this program expands, we can all share in the opportunity to be a recognized source of information impacting the public while creating a positive impact on our profession.
Jeanna Fifer, CFP®
Cahill Financial Advisors
Financial Education Committee works with BestPrep’s Classroom Plus
Members of the FPA Financial Education Committee worked with BestPrep in September to participate in BestPrep’s Classroom Plus program in the Chanhassen/Chaska high schools. This “Sales Demo” program provides students with increased ability to connect classroom curricula and theory with real world application – in this case, in the area of customer engagement and sales. FPA members partnered with other professionals from various industries to role play and evaluate students’ ability to engage customers, present products, overcome objections and close sales with appropriate follow-up with the customer.
It was a very worthwhile volunteer opportunity and a great way to connect with and coach our future business professionals!
There are numerous upcoming volunteer opportunities with BestPrep and community-based organizations. If you are interested in participating, please contact Jason Kley (firstname.lastname@example.org or 952-230-6705).
Student/Career Changer: "Shadow" a CFP® at Financial Planning Day
Do you know a college student or career changer interested in pursuing a career in financial planning? Come find out how financial planners communicate with clients! The Career Development Committee and FPA of Minnesota are offering an invitation to attend Financial Planning Day as a “shadow” financial planner on October 29th. Financial Planning Day is a free event open to the public where attendees can come in to discuss personal financial questions and concerns with a volunteer Certified Financial Planner™.
Each accepted student or career changer will be matched with a CFP® while they complete the free consultation with attending clients. Topics such as personal finance issues, debt management, and retirement planning will be covered, depending on the needs and questions of the client. For more information, contact Megan Olson at email@example.com or see the application for more details.
Can the scary story of DOL have a happy ending?
Although October has just begun and I have yet to put serious thought into my Halloween costume, it is the appropriate time to think about something truly frightening, I am of course referring to the DOL Fiduciary rules. The spector of BICE, the threat of class action lawsuits is enough to leave the bravest advisor shaking at the knees.
For all the meetings, webinars and articles that I have read concerning the new law, I cannot offer any substantive advice on how to deal with the new rules. It seems nobody truly can. Like any good horror movie, it is not knowing what waits behind the door is what is truly scary. The complexity of the rules combined with the complexity of the financial services industry has everybody waiting for the DOL to put forth a plethora of explanations on how they expect advisors to act in a multitude of situations. That has to happen soon because the rules expect a structure in place by April 2017 and full compliance by the beginning of 2018.
What I have read that has been prescient for what lies ahead was Doug Lennick’s article in the August issue of Journal of Financial Planning appropriately titled Preparing for the Certainty of Uncertainty under the New DOL Rule. Lennick recommends that Advisors prepare by doing the following:
Help clients behave appropriately and reduce their financial stress by preparing them for the certainty of uncertainty. Lennickis a big believer in behavioral finance but even if you can’t name all the biases listed in Thinking Fast and Slow, advisors have to start looking at themselves as behavior changers. We are good at making financial plans can we do a better job of getting clients to follow them?
Know that your value is advice, not products. Getting people to act in their best financial interest is a greater determinant of success than their return. Advice that changes behavior instead of changing investments is where the future of the financial services industry lies. Robo advisors are extremely efficient at changing investments but human advisors are far better at getting a client to change their behavior.
Know that holistic, advice-based financial planning for a client includes more than asset management. This is no big news to those of us in FPA that are trying to elevate the profession of financial planning. The post-DOL rule advisor is going have to focus less on investments and more on every other aspect of the client’s financial picture.
Look for ways to systemize the predictable in order to make more time for holistic financial planning. Leveraging technology (including robo advisors) in order to make more time for face-to-face interactions with client is essential for the post-DOL rule advisor. Technologies that better document and explain the services that advisors are providing clients will be essential for success.
If you haven’t had the guts to face DOL head on, now is the time to start figuring out what it will mean for your practice. I think Doug Lennick’s article did a good job of explaining what it means for financial services – there is no slowing the shift from selling financial products to providing comprehensive financial planning. No doubt this is a pivotal moment for old school investment advisors. Planning-oriented advisors though have just as much to consider. DOL challenges us all to create a better financial planning experience for our clients and to start thinking of ourselves also as influencers of our client’s financial behavior. If we can do that then there will be a happy ending for advisors and their clients.
Is Your Data Safe? The 2016 Financial Adviser Cybersecurity Assessment
The issue of cybersecurity for financial advisers and their firms is as complex as it is critical to the future of the industry.
Despite the fact that 8 in 10 advisers identify cybersecurity as a high priority, only 29 percent of advisers completely agree they're fully prepared to manage and mitigate the associated risks. This significant disconnect only serves to demonstrate that advisers lack a clear understanding of the risks, as well as the ability to identify a common path forward to neutralize this critical issue.
Is Your Data Safe? The 2016 Financial Adviser Cybersecurity Assessment from the FPA Research and Practice Institute™ and sponsored by TD Ameritrade Institutional, is a quantitative report that will inform three whitepapers available in the coming months designed to deliver much-needed actionable next steps to address cybersecurity threats.