A survey conducted by the Society of Financial Service Professionals (FSP) shows that the nation's top financial advisors place a high value on the credibility afforded by their professional designations. In fact, 61 percent are willing to submit their designations to regulation by an outside body in order to preserve that value.
The survey was sponsored by the society's Retirement Counseling Professional Interest Section, and 1,250 FSP members participated.
According to FSP President Jim Tyrpak, "The results clearly show that our members -- the country's leading advisors -- are sensitive to the commoditization of financial credentials and believe that steps should be taken to protect the value of their hard-earned designations." He also noted that "the findings reflect our members' concern with so-called 'motel credentials,' the current regulatory actions being taken to prevent use of designations to perpetuate scams, and the sensitivity of many brokers and compliance departments to the use of any credentials on stationery or business cards."
Society members were in agreement when asked whether all financial designations should go through an accreditation process, with 94 percent responding that they should.
There was less agreement when asked which bodies should regulate credentials -- FINRA (Financial Industry Regulatory Authority) was the top choice for 41 percent of respondents, while ACCET (Accrediting Council for Continuing Education and Training) came in second with 32 percent of the tally, and NAIC (National Association of Insurance Commissioners) was third with 27 percent.
Ninety-one percent of respondents said that "there should be a central source of information explaining any and all designations, including their educational requirements, and providing consumers with a place to lodge complaints." However, respondents were divided over what body should act as a clearinghouse -- FINRA came out on top with 43 percent of the vote followed by 25 percent for NAIC and 23 percent for other -- with the Securities and Exchange Commission (4 percent) trailing far behind.
Two final questions rounded out the survey. When asked, "For most advisors, are designations primarily marketing tools or a source of ongoing education?" seventy percent of respondents chose "education source." And the statement, "It is the client's responsibility to research an advisor's credentials" met with a high degree of approval -- 64 percent agreed.
From the April 01, 2008 issue of Agent’s Sales Journal • Subscribe!
