PLANNER GROUPS MAY UNITE

The two largest financial planning associations are considering a merger as a means of saving money and fending off increasing incursions from other professions that represent growing factions of the investment advice business.

The 17,000-member International Association for Financial Planning, based in Atlanta, and the 12,500-member Institute of Certified Financial Planners, based in Denver, are talking about ways they can work together, according to officials of both groups.

Leaders of both organizations stress they are open to a realm of possibilities, including everything from merging to merely cooperating on lobbying efforts. Talks also have included creating a third organization that would act as an educational arm.

“Everybody would like financial planners to speak with one voice,” says Janet McCallen, executive director of the IAFP, in explaining the reasons for the discussions. “The problem is, everybody would think it should be (his or her own) voice.”

But ICFP President Robert Klosterman says the talks were precipitated by IAFP’s adoption last fall of the Certified Financial Planner designation for financial planners, which his organization promotes.

“Any organization that’s going to move more toward our mission, we should be talking to them more,” says ICFP spokeswoman Brigid O’Connor.

The decision to go ahead with the talks was made at an early-January meeting in Philadelphia between an IAFP delegation of Ms. McCallen, Chairman Peggy Ruhlin and President Richard Rojeck, and the ICFP’s Mr. Klosterman, Executive Director David Brand and Chairman Judy Lau and Mr. Klosterman.

The group is to meet regularly this year. Ms. McCallen expects discussion on such issues as the growing demand for financial planning as baby boomers decide how to deal with their wealth, how technology is changing the business, and the incursion into financial planning by accountants, lawyers and other businesses.

A merger between the two groups could provide substantial operat
ing efficiencies. IAFP, with a 1998 budget of just over $8 million, has 33 employees, while ICFP has 40 employees and a 1998 budget of slightly more than $5.7 million.

Neither group is predominant, Mr. Klosterman says, adding that the two want to provide a forum for different constituencies within the industry while still speaking with one voice. Lobbying is the most natural area for cooperation, he adds.

ICFP represents financial planners who either hold the certified financial planner designation or are studying to pass the exam, while IAFP has a mix of practitioners.

According to Ragan Morrow, an IAFP spokeswoman, about 12,000 members are financial advisers and the rest are from broker dealers or companies, such as software vendors, that provide services to advisers.

Of the 12,000 advisers, 52% are CFPs, 24% are insurance agents, 9% are accountants,3% are lawyers, with the rest in related fields.