Mentor shortage hits CFP
The growth of financial planning, particularly the top level, is being hampered in New Zealand by the changing face of the advisory industry.
To achieve the top-flight Certified Financial Planner (CFP) status, a planner has to spend a period of time working with a mentor. However, there are insufficient mentors, or advisers willing to be mentors, in New Zealand.
This problem has been accentuated in some of the big organisations, such as banks, where there is a desire to move their growing band of advisers to the CFP status, but there is no one in the organisation to undertake the mentoring role.
Not surprisingly people in other organisations aren't willing to be mentors for their competitors.
Financial Planning and Insurance Advisers Association (FPIA) chief executive Phillip Mathews acknowledges the problem is a major impediment to the growth of the CFP designation in New Zealand.
"There aren't enough CFPs," he says.
The association is looking at changes to reduce this bottleneck and will move "quite quickly" on the problem.
He also assures existing members that the association "won't reduce its standards or hurdles."
Added to this problem is the automation of the financial planning process. In a number of the big organisations, advisers do interviews with clients, then a standard plan is generated by computer. Because the plans are developed based on a formula, rather than being tailored individual plans, there is an argument that they don't need to be reviewed by a mentor.
Another possible change is that the association may do away with the provision, in some cases, for financial planners to do an introductory course on planning as many of the big organisations have in-house courses.
While the CFP brand has been almost invisible in the market place since it was introduced several years ago things are set to change this year.
Mathews says the financial planning college of the association has built up "a bit of a war chest" and will do some promotion of the brand later this year.
He says there is a good opportunity to do this in April when the International CFP council meets in Auckland.
Recommended for you
ASIC has launched legal action in the Federal Court against SQM Research and Interprac Financial Planning, citing alleged failures related to the Shield and First Guardian fund collapses.
While interest in private markets continues to grow, a panel of industry professionals have argued that data and reporting challenges in this sector are limiting accessibility for financial advisers.
Evidentia Group, a wholly owned subsidiary of Generation Development Group, has entered into a binding agreement to acquire consulting firm Encore Advisory Group.
MST Financial has announced the completion of its acquisition and integration of FIIG Asset Management from AUSIEX, bolstering its leadership team in the process.
