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CFP Professionals Can Play a Valuable Role with Voluntary Social Services

By Sunho Kim, CFP

Korean Financial Planning Professional Sunho KimAccording to the Financial Planning Standards Board‘s definition, “Financial planning is the process of developing strategies to assist clients in managing their financial affairs to meet life’s goals.” CFP professionals are experts in financial planning mapped out in strict adherence to the stringent standards of education, examination, experience and ethics (4Es). Clients are fully satisfied with the financial planning service delivered by CFP professionals who meet FPSB’s strict certification standards and fulfill the requirements as stated on the aforesaid definition.

Financial planning is not well-known in Korea despite the huge satisfaction among clients with financial planning services.  The public awareness of financial planning or CFP certification still remains low even though the financial planning profession was launched 10 years ago. The results are somewhat disappointing considering the efforts that have been made to raise public awareness of financial planning over the last several years; like announcing the names of those who passed the CFP exam, running ads related to financial planning or CFP certification, and consecutively publishing columns mainly about financial planning in financial newspapers. This low awareness among the public is attributable to a combination of few factors:

First, there is a misconception among the public that financial planning is only for the wealthy. Second, they mix up financial planning with investment planning. They are more interested in the return on investment in specific assets rather than planning for their future from a comprehensive perspective. Third, they tend to regard financial planning as a preliminary service offered to induce them to buy insurance or financial commodities. Specific commodities can be recommended in the course of financial planning, but financial planning does not aim to recommend specific commodities.

As a prerequisite for addressing the misconceived perception and low awareness among Koreans towards financial planning and CFP certification, CFP professionals need to gain recognition from clients with regard to their specialization and ethics. For that, CFP professionals must offer services in compliance with the six-step financial planning process and leverage their expertise and capabilities to resolve the problems related to the clients’ money and life in an appropriate manner. The services, provided in that way, will ultimately lead clients to recognize the value of financial planning, and CFP professionals will gain even wider recognition through the word of mouth by such clients.

KFPA (Korea Financial Planner Association), a sister organization of Financial Planning Standards Board of Korea (FPSB Korea), is striving to expand the opportunities for CFP professionals or its members to engage them in voluntary social services. Such voluntary social services offered by the Association are divided into free financial planning service and free financial education. As the case may be, both consultation and education are often offered at the same time. KFPA has constantly offered free planning education in collaboration with CFP professionals or its members to those living in Aeranwon, a facility for unmarried mothers, and Hanawon, an education facility for the North Korean defectors. Additionally, KFPA sends instructors over to JA Korea, an economic education organization, to provide elementary, middle, high school and university students with education related to economics. Furthermore, KFPA joined hands with Seoul Metropolitan Government and provided consultation on financial planning in a bid to help low income earners to stand on their own feet. In particular, KFPA has proceeded with a campaign themed “Pro Bono Financial Planning for 10,000 Persons” in large major cities nationwide since last year, in collaboration with Chosun Daily (daily newspaper), offering education and consultation in parallel.

The consultations on financial planning and financial education, which are made available by KFPA, have been the key driver that motivates CFP professionals to play a valuable role. Such consultation and education created an opportunity for many people, who were denied appropriate services from existing financial institutes, to reflect on their lives and money, and have been helpful in giving them hope. The aforesaid consultation and education had also been a primary contributor to change the perception of ordinary people, and furthermore, have been fully leveraged by CFP professionals and the members of KFPA who participated in that endeavor. They gained insight into the psychological state of those seeking advice and have empathy with them. By dealing with the clients who are different from the existing clients, they could identify the needs of various clients. Besides, CFP professionals working at financial institutes and the members of KFPA had a chance to experience a world different from the one that they know.

Financial education and consultation on financial planning create good opportunities for many ordinary citizens to have better understanding on the value inherent in the CFP designation. In addition, financial education and consultation on financial planning serves the public interest by helping ordinary citizens draw up their financial plans. Korea is founded on the idealism of Hong-ik-in-gan, which means “Devotion to the Welfare of Humankind”. This idealism that advocates universal benefits of humanism can be turned into reality by offering financial education and consultations on financial planning. CFP professionals can position themselves as experts who benefit others through their voluntary social services and expertise.

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