Pro bono financial planning needs fintech to step up

Fintech could be the leg up that pro bono financial planning needs, according to new research from the Foundation for Financial Planning.

While a 2021 survey by the Certified Financial Planning Board of Standards found that 60% of CFP holders had done some pro bono planning over the past two years, averaging 28 hours per year, those numbers are virtually unchanged from two years earlier.

Jon Dauphine, FFP chief executive, believes the industry can do better and that technology can help make that happen.

The results of five focus groups and a survey of 400 CFP holders over the summer have convinced Dauphine that fintech innovation hasn’t been as focused as it could be on pro bono services.

Of those advisers doing pro bono work, 45% say they are still using pen and paper for rudimentary household budgets and debt management for their pro bono clients.

“When we asked advisers what they needed in terms of technology to make their pro bono work more effective, 72% said they’d be more likely to use financial planning software if it were simple, free, and relevant to pro bono client’s needs,” Dauphine said.

The research found that the most relevant needs of pro bono clients involve creating budgets, building emergency funds, and managing credit card debt. All things that Dauphine said are not the major challenges for most paying clients, which is why he believes fintech is not innovating in those areas.

To be fair, the fintech space isn’t completely turning its back on pro bono efforts.

In September, Orion started offering free adviser access to its platform for pro bono planning, and eMoney at its annual conference this week announced a pro bono challenge, giving the first 100 advisers to sign up free access to its financial wellness mobile app.

Dauphine is hoping the FFP research will serve as a “roadmap for how to develop technology solutions that can really lead to more innovation that will drive pro bono engagement.”

Specifically, advisers who are actively donating their time and effort to provide financial planning say the focus should be on areas that rarely apply to paying clients, including information on public benefits and calculators designed for lower income households, and systems for gathering basic client information before the first meeting.

The respondents “also felt it would be useful if there was a way to access chunks of educational content to reinforce details for additional learning,” Dauphine explained.

“We’re trying to say, if you’re a fintech or an innovator, we know there is so much technology driving the paid engagements, but in pro bono it’s lagging behind,” he added. “We’re trying to really understand the needs of the pro bono client and the advisers providing pro bono services, and bring that knowledge to the industry.”

Dauphine said FFP is actively working with fintech companies to help effect change in the pro bono financial planning sector.

"These companies have showcased commitment and willingness to contribute to our collective vision and help boost technology that can further the pro bono efforts in the industry," he added.

Advisers looking for ways to offer pro bono services can register at FFP’s ProBonoPlannerMatch.org, where they can find areas of need across the country.