Extending Financial Planning’s Reach

Kamila Elliott is the first Black chair of the Certified Financial Planner Board of Standards, a nonprofit that establishes and enforces the requirements for the CFP certification. Elliott is CEO and founder of Collective Wealth Partners.

You’ve said one of your key goals as chair of the CFP Board is to increase the number of women and minority planners, along with attracting more young people to the profession. How do you plan to do that? By raising awareness. I didn’t know what a financial adviser was until I was in college. My mom didn’t have a financial planner, and neither did my grandparents. The CFP Board just hired someone whose goal is to work with high schools to create more financial literacy and awareness. At colleges, we have more than 300 programs where we help people reach CFP certification, and we want to increase the number of programs. We also have a goal to increase the number of CFP Board registered programs at HBCUs [historically Black colleges and universities].

Are some college grads deterred by the cost of becoming certified? We’re working to remove any financial impediments people may have on the path to certification. We have multiple scholarships available for CFP certification education and exams, and we have mentorship programs for diverse individuals and women. Financial professionals have a higher median salary than the average college graduate, and you’re helping people reach their financial goals. This is a profession where you can do good for yourself and do good for others.

What can the financial planning industry do to reach out to people who need advice but don’t have a lot of money to manage? We’re seeing a little more creativity in how firms structure their planning fees. Instead of using an assets-under-management model, they’re doing things like subscription models in which people pay a monthly planning fee. If you don’t have a lot of assets, you may not need as much complexity, so they are creating a structure in which the fees are commensurate with the level of planning provided.

At a time when individuals are turning to everything from TikTok to Reddit communities for investing advice, how can the CFP Board demonstrate the value of working with a CFP professional? On those forums, you don’t see much conversation about short-term and long-term capital gains rates. You don’t see conversations about whether you have the right estate plan. We’re happy that people are talking about investing, but we’re the ones they go to when they’ve made money. As you have more assets, there’s more complexity. This is a fairly new profession, and we’d like to do more research to show the public that when they work with a CFP professional, they’re able to reach their personal goals more quickly and see a difference in investment returns. Just as when you see a doctor you have better health, if you’re working with a CFP professional, you’ll have better financial health.

The market has been extremely volatile recently, particularly in specific sectors. Any advice for investors? I spent most of my career at the Vanguard Group, and the advice there was always “stay the course.” Your asset allocation should be reflective of your short-term and long-term goals. If you have the right allocation, there’s no need to make any changes to your portfolio right now, unless something has changed with you.