The American College of Financial Services is revamping the chartered financial consultant designation to focus on applying strategies to client situations and including new coursework on topical issues such as divorce, retirement income planning and concerns specific to gay couples.
The new program of study will provide more guidance on matters of immediate interest to
financial planning professionals and their clients, said Craig Lemoine, ChFC program director at The American College.
“We're positioning ourselves to be more relevant to practitioners — those who work with clients in the financial services community,” he said.
Mr. Lemoine said the redesigned ChFC will offer advisers more training in advanced topics and more “hands-on” instruction than the education provided in the coursework for the certified financial planner designation, which is the leading certification held by advisers and is awarded by the Certified Financial Planner Board of Standards Inc.
Competition between the American College and the CFP Board began heating up in 2009 after the CFP Board added a fiduciary standard for its planners. More recently, the American College
publicly criticized the largest member organization of advisers, the Financial Planning Association, for advocating the CFP designation.
About 17% of advisers have a CFP designation, compared to 11% who have ChFCs, according to a 2013 analysis by Cerulli Associates Inc.
The ChFC designation has historically been the domain of agents and advisers working with insurance. Many industry executives aren't as familiar with the certification.
“I think the CFP and the CFA [chartered financial analyst, offered by the CFA Institute] are the two that at least in our space are the coin of the realm,” said Douglas Wolford, president of Convergent Wealth Advisors. “We see a ton of resumes and just don't see [the ChFC] come around.”
One significant difference: Whereas the CFP Board has drawn criticism over the past year from those who think the board's definition of a “fee-only” adviser is too strict, the ChFC is integrating content that is “compensation neutral,” Mr. Lemoine said.
The new curriculum will include applied legal and ethical principles, focusing on the duties of an adviser under suitability and fiduciary standards and what to do when the rules conflict, he said.
“An adviser with a fee-based model [as well as] a broker-dealer sales relationship will learn a lot from the new class,” Mr. Lemoine said. “It's important for advisers to understand the complex legal and regulatory requirements of different models.”
The ChFC program of study will now include nine required courses instead of offering a series of electives for the final two classes, and it's expected to be more rigorous, Mr. Lemoine said.
The first new course will cover planning issues related to divorce, special needs family members, small businesses, and financial advice for the lesbian, gay, bisexual and transgender community. The second class will include retirement income planning, behavioral finance and applied ethics.
Those already taking courses to fulfill the ChFC saw a change for 2014 that requires students to construct and write a financial plan, as opposed to an earlier version of the course that mostly involved reading cases.
The American College also confers the chartered life underwriter designation, a new retired income certified professional designation and is a provider of education for those attaining the CFP designation.
