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Positive Signs the CFP Professional Market is Growing in Taiwan

By Taylor Liao, CFP, Chinese Taipei

The biggest barrier to growing the number of CFP professionals in Taiwan is that the CFP certificants can’t see a clear and bright future for the profession. Most of them have no idea about how to use this certification to benefit themselves. Only a few CFP professionals are able to discover the market potential of financial planning and successfully make a living running a fee-based or fee and commission-based practice. At this point in time, no one can claim that they are running a financial planning business successfully, but more and more positive signs are apparent for this profession.

Firms Embracing CFP Certification

Two of the biggest insurance companies decided to embrace CFP certification in their organization. That’s good news for expanding the number of CFP professionals. The next question is how can insurance companies promote the values of CFP professionals in their daily operations? There are pros and cons for insurance companies when promoting CFP certification. One benefit is that the number of CFP certifications would increase dramatically. One disadvantage, from a firm’s perspective, is that CFP professionals might provide financial planning advice for free to clients. If a firm wants to embrace financial planning successfully, they need to use the correct model, meaning they need to abandon the idea of using financial planning as a medium to sell insurance products. Firms also need to realize that insurance isn’t necessarily the only solution for clients.

A clever way for insurance companies to do this would be to train a small group of sales people by requiring that they have CFP certification as well as additional training in tax, estate planning, etc. This will help attract a wider range of clients such as middle-class or high-net worth individuals. These professionals will be able to offer more than just insurance. The risk for the company is that these individuals may be tempted to leave the firm and start their own advisory practice after they get their CFP certification.

Companies need to be more open-minded to training their advisers about areas other than insurance. Some CFP professionals might worry that these insurance sales people who earn their CFP certification will only be using financial planning as a medium to sell insurance products, and that this would hurt the financial planning industry. I understand this risk, but I think more consumers would gain awareness of financial planning and CFP certification which is ultimately more important.

Developing Workable Business Models

I am involved in a group called the Taiwan Financial Planning Association (TFPA). There are about 100 members in the group and they are all CFP certificants. We are working on developing a workable business model for CFP certificants. Financial Planning Association of Taiwan (FPAT) is a member of FPSB and handles the CFP certification examinations in Taiwan.

Myself and the other TFPA members are currently working on some workable business models related to financial planning services: investment management model, Charitable Trust, EAP(Employee Assistance Programs)…etc. The model is usually created by one member of TFPA. After the initial development stage, the model is introduced to all members for feedback and to measure interest. Those who are interested form a group and continually work on the project.

Our goal is to develop a more workable and profitable business for financial planners. As I said earlier, the biggest barrier to growing the number of CFP professionals in Taiwan is that CFP certificants can’t see a market opportunity for financial planning. Even if they’ve passed the examination; they don’t know how to succeed in created a practice. The big decision for most CFP certificants is whether to become an independent financial planner or not. Some of the fears for financial planners when deciding include: where to find clients, how to start a planning practice, what fee he/she should charge, what process to use to effectively help clients create a financial plan, and what solutions should be provided.

All of these questions exist and there is no clear answer from the market here, because there aren’t any role models to follow. Taiwan only has a few financial planning firms that are between 2-20 employees and it isn’t obvious whether they are successful or not. Because of the small size of the market, CFP certificants are afraid to join the financial planning profession. I think this is a very natural reaction.

Fortunately, two of our projects are successful: investment management of clients and the Charitable Trust. With more and more successful projects and experience behind us, we will call upon more CFP certificants to join our group and this should give them the confidence to start their financial planning careers.

Launching Training Courses

Another thing I am doing to contribute to the financial planning profession is sharing my experience through training courses. In talking to other CFP professionals, I recognize a common theme of uncertainty around setting up a practice. The psychological barrier to ask clients to pay a consulting fee was too much, and so the planners undercharged. If a planner starts in an insurance sales position, it is very difficult to transition to charging fees, because clients don’t understand why they would pay for advice that used to be free. It is difficult to start a financial planning practice if he/she doesn’t leave their current job, because the daily sales activity takes up most of their time.

I am working on launching a training course to teach financial planners how to open a practice and be a successful financial planner. The class is open to anyone interested in becoming a financial planner. I hope this is a useful tool for CFP certificants. We don’t have anything like this in Taiwan and I think that is another barrier to the growth of the number of CFP professionals. I’d like to cooperate with other experienced planners to organize more training courses in the future to assist CFP certificants.

Using Modern Technology 

An increasing number of clients are seeking assistance from CFP professionals. They are starting to understand that big brand name banks aren’t necessarily the best. I spoke with a client recently who have over one million US dollars in a private bank for five years and lost 40% of his money. He said the manager of the bank never contacted him nor did he take care of the client’s assets. I met another client several days ago who had just retired from a DRAM manufacturer. When signing our contract, I asked him how he found me. He told me that he and his wife knew CFP professionals put the clients first and they trusted CFP professionals more than wealth managers in banks. They weren’t even sure there were CFP professionals in Taiwan, but they searched for “CFP” on the internet and found me.

I met both of these clients in just one week. They both have about one million US dollars available for investment. This is a very positive sign that CFP professionals are gaining more awareness among the public. We should continue to pursue exposure on media channels and the internet to promote CFP professionals and financial planning.

I think financial planners should learn how to use social media and blogging to promote themselves and build the overall awareness of financial planning. The next project I want to tackle is to build software resources so my clients can use their smartphone in collaboration with my services. They can send us a request for more information if they are simply researching their options or they could pay us fees if they are already clients. If CFP professionals can quickly learn how to take advantage of modern technology to work with their businesses, this will greatly move the financial planning profession forward.

Read KP Liu, CFP, CEO of FPAT’s response titled CFP Certification at a Turning Point in Taiwan!


4 comments to Positive Signs the CFP Professional Market is Growing in Taiwan

  • I hope there’re enough people browsing this website and knowing that the CFPs in Taiwan are struggling for a new business model for the financial environment.
    As Tailor says, it seems a positive sign for the CFP profession, but the insurance companies and their sales are the most difficult groups to transform themselves into financial adviser career. I worry that they would hang out the customer interest first plates but sale insurance policies as they used to be. CFPs or IFAs must find out their own ways to survive and to benefit their clients differently from the banking consultants do. Once a few CFPs succeed, the other CFPs would and could follow up. Then, the financial planning industry would gather more and more advisers or consultants. The number of CFPs in Taiwan would bloom as the stars in the sky.

  • The struggles that CFPs are having in Taiwan is not much different than in North America when the CFP was first brought in. Even now, the vast majority of CFPs derive their sole income from the final sale of a commissioned product or assets under management.

    However one is compensated, the standards and practices that a CFP needs to apply will serve both the client and CFP. A comprehensive six step process ensures that the needs of the client can be well addressed. Of course many of the solutions are investment and insurance products. It is the implementation of the right product at the right time that makes all the difference. Without the training that a CFP has received identifying needs and solving financial problems would be very difficult.

    I encounter everyday new situations that require insight and knowledge that only a trained financial planner would be able solve.

    Keep up the good work and know that the thousands of CFPs worldwide are supporting your endeavours.

  • Frank Lee

    Is there a textbook for CFP professionals in Taiwan? We should address the need for a Taiwanese client or a Taiwanese-American client, for whom may fundamentally differ from an American client for which CFP was originally intended. A high quality textbook may also serves as a handbook which would elevate the visibility and the credibility of CFP in the Taiwanese market.

  • Frank, unfortunately the textbook were written by the teacher who have no experience of financial planning. The CFP certificant cant’t find a real practice training now at Taiwan. That’s the problem. Due to only quite few IFA now, the market is so small for developing the market of this kind of class.

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