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Why is Taiwan Facing Declining CFP Professional Growth?

By Christine Chang, CFP, Chinese Taipei

According to a recent Reuters article, the number of CFP professionals has increased by 23% in the past five years. In addition, the Financial Planning Institute of Southern Africa has declared a 9% increase in its CFP professionals (Horowitz). When world-renowned companies such as Merrill Lynch and UBS are encouraging their employees to acquire their CFP certification and affirming the framework of the CFP credential, is it still pertinent to discuss the barriers of growth for CFP professional numbers?

This conversation is crucial in Taiwan as we are facing not only barriers but negative growth in the  number of CFP certificants. What are the reasons behind this? Is it due to a lack of ability because the tests are too rigorous for people to qualify? Or is it due to a lack of motivation because of too little compensation for acquiring a CFP certification? Whichever the case, the money spent is disproportionate to the work needed in getting a CFP certification.

My personal opinion on this matter is that the lack of motive and incentives are the major reasons behind Taiwan’s negative CFP professional growth. I believe if someone has a strong incentive to work, then no matter how hard the task, she would still do her best to get it done. How do we create the right motives? Why would one in the financial services industry promote oneself as a CFP professional in addition to his or her own skills? I believe it’s more than just another title on a name card to boost confidence. Achieving CFP certification requires an advisor to put the client’s interest ahead of their own; to serve the client’s needs instead of pushing sales, therefore earning the client’s trust and respect. In a more practical sense, getting CFP certification leads planners to more clients, more revenue and more profits. As Dwight Mathis, the head of new advisory strategy at Merrill Lynch Wealth Management says, “If you have your CFP mark, you achieve more revenue and grow at a faster rate.” Another study from the consulting firm Aite Group that was sponsored by CFP Board concluded that brokerage teams that included at least one CFP professional generate 30 percent more revenue than teams without one (Horowitz).

Taiwan introduced the CFP designation in 2004. When it was first introduced, it inspired the industry and many investment and financial advisors flocked to apply for the classes and tests needed to meet the requirements. With 240 hours of class time and six categories to test in, one without adequate preparation often failed the test and had to start over. Nonetheless, people participated with great enthusiasm, mostly because they were inspired by the CFP mark’s motto of “putting the client’s interests ahead of ourselves”, but also because we aspire to be like other modern countries where the CFP certification training enables us to become a well-rounded financial planner for our clients and not just a salesperson of financial products. We do not want to peddle the “medicine” for our client’s financial ailments, but to be the doctor who treats and solves our client’s financial difficulties.

Most of Taiwan’s CFP professionals have not yet been able to generate the 30% more revenue before-mentioned by the Aite Group study. As a sales person, the workload of financial planning coupled with selling products is far greater than the possible earnings one might make. With longer working hours yet not enough increase in our earnings, this may be the “barrier” that prohibits newcomers in joining the CFP professional club. According to the Financial Planning Association of Taiwan’s website, there were 1,073 people who passed achieved CFP certification since 2004. However, many people discontinued their certification later, though continuing their career in the financial service industry.

Currently in Taiwan, financial institutes control the market and consumers don’t understand that their priority is making purchases. Taiwanese consumers have not developed a mindset that allows them to pay for financial planning. Luckily, we still have many CFP professionals, myself included, who are still adamant in continuing our work. We try to approach our clients from a financial planning point of view. We hope to be able to educate consumers through the process of our services, and also to hone ourselves to be more skilled and knowledgeable. We’ve organized the Taiwan Financial Plan Association who hosts meetings frequently for financial planning professionals to share experiences with each other. I believe when consumers understand that financial products are only implementation tools and the “reason for buying” or “planning in advance ” becomes the ultimate goal, then the CFP professional market in Taiwan will really flourish and grow.

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

1. Horowitz, Jed.Brokerage firms debate value of Certified Financial Planner title”. Reuters. June 3rd, 2013.

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