Should CFP Board require technology training? Advisers seem to think so

In a new study from T3, 85% of advisers say technology should be a part of continuing education requirements

Feb 6, 2019 @ 5:15 pm

By Ryan W. Neal

Should technology training be a requirement for certified financial planners? Many advisers seem to think so.

According to Joel Bruckenstein, producer of the Technology Tools for Today conference, and Bob Veres, owner of consulting firm Inside Information, advisers are struggling to keep up with the technology curve.

In a new study of the adviser technology landscape, 85% of 5,508 advisers surveyed said the Certified Financial Planner Board of Standards Inc. should grant continuing education credits for technology-related sessions.

While other groups providing industry certifications, such as the Investments & Wealth Institute (formerly IMCA), offer credit for technology sessions at industry conferences, the CFP Board does not, Mr. Bruckenstein said.

"If you bought a program five years ago and you've never taken a course on it or on what the new features are, you're probably no longer competent on it today," he added.

But in an email, CFP Board managing director of professional practice John Loper said the organization is approving technology continuing education that aligns with its new Code of Ethics and Standards of Conduct, which go into effect Oct. 1.

There are 30 courses approved for CE credit related to cybersecurity, fintech and using technology to improve client interactions.

But the board does not approve courses that are "firm-specific or related to practice management,"Mr. Loper said.

But Mr. Bruckenstein said this way of thinking is "as antiquated as the slide rule.

"If you don't understand how the technology works, you can't serve your clients," he said.

(More: Advisers no longer fear automation taking their jobs)

Of course, Mr. Bruckenstein has skin in the game. It shouldn't really shock anyone that the producer of the industry's best-known technology conferences thinks advisers should be required to attend sessions on technology.

He acknowledges the conflict ("Would it be good for T3? Absolutely"), but says it's a cause he's been advocating for 25 years. Though it may look like Don Quixote tilting at windmills, it's a change he believes is important for the future of the industry.

"I'm not going to be doing this forever, if you know what I mean. It would have been much better for me if this happened 10 years ago," Mr. Bruckenstein said. "We're coming up on 2020 and the fact that we're still talking about this, it feels like we're in the Twilight Zone."

Tech training shouldn't just be part of ongoing education either, but should be required to earn the CFP designation in the first place, he said. New CFPs opening up shop need to understand what's out there in order to effectively perform due diligence on possible tools, especially as financial planning becomes increasingly important in the industry.

According to the study, 34% of respondents with less than five years of experience rate financial planning as their most valuable software, versus 17% of those with more than 20 years.

(More: Next generation of financial planning on display at 2019 T3 conference)

"It appears that the next generation of advisors is more intent on focusing on more than investment returns to help their clients achieve their goals," Mr. Bruckenstein and Mr. Veres conclude. "We also think that younger advisors are offering planning services because they perceive that the demand among their generational cohorts is there for planning as opposed to strictly investment advice."

According to an InvestmentNews report, technology training is an area in which schools are doing a better job than organizations like the CFP Board. Students who get first-hand experience with adviser fintech, such as financial planning software, often have an advantage when it comes to getting a job.

One challenge to making technology a training requirement is the daunting number of different products available for advisers and how quickly the tools change. As Mr. Bruckenstein's own report notes, "the permutation of possible software stacks is virtually infinite."

If that's the case, how could a group possibly construct a standardized curriculum for technology that's of any value? For example, what if a CFP candidate learns all of the ins and outs of Redtail CRM only to be hired at a firm that uses Salesforce, forcing him or her to start from scratch?

The answer is to consider current education around investment products, Mr. Bruckenstein says. When advisers learn about insurance, they don't have to be an expert on every single policy, but they do learn which types of products are appropriate, or inappropriate, for which clients in which situations.

Similarly, advisers should be get a general overview of software for customer relationship management, financial planning, portfolio management and even robo-advice to learn how they work and when they are useful for clients.

For Mr. Bruckenstein, it's simple: "There's no way you should be practicing as a CFP today and not have some really good knowledge about how to select software and know what the software you're using does and doesn't do."

The CFP Board determines its examination and education requirements every five years with a job task analysis. It is possible the next analysis may alter the CFP Board's thinking around technology.

"Given that the last JTA was conducted in 2015, CFP Board expects to initiate the next one soon," Mr. Loper said.


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