What? There are too many letters after my name? I don’t see how my full list of professional degrees and professional designations are an issue! So what if my name is Daniel M. Yerger Masters of Business Administration Certified Financial Planner Chartered Financial Consultant Accredited Investment Fiduciary Certified Divorce Financial Analyst.
…Okay you might have a point. But seriously, all of that Alphabet Soup is great! Don’t believe me? Let me explain.
The Roots of the Problem
When I started as a financial planner, I had just completed my Masters of Business Administration (MBA). While a great education, an MBA is fundamentally a executive management level course in how to run a company. While I find this education enormously useful in running my business and in helping my entrepreneur and executive management clients, it doesn’t really have much to do with financial planning (just one elective on the subject, in fact!) So after a few years of getting my feet wet in financial planning with my MBA and my Series 7 and 66 licenses (education and credentials permitting investment management and advice), I really wanted to get deeper into it.
The first professional designation and credential I acquired as a financial planner was the gold standard of financial planners, the CERTIFIED FINANCIAL PLANNER™ Certification (CFP®). Being a financial planner without a CFP® is like going to a surgeon who doesn’t have MD after their name. You might not notice at first, but you probably should ask some questions. The CFP® Certification includes several requirements, among them 6000 hours of practice as a financial planner (a la a med school residency), a bachelors degree, the completion of eight graduate level courses in financial planning covering 72 topics, and the passing of a comprehensive exam with an average pass rate of about 62% (lower than the Bar Exam in many states, though the California bar still has the dubious honor of a 40.7% pass rate). But here’s the kicker. After years of practice and study to receive the gold standard of financial planning, the biggest thing I learned was: I didn’t know enough! So back to the books.
Next Up – Fiduciary
The CFP® Certification requires that its holders practice as Fiduciaries at all times when serving clients, but it’s actually pretty vague on how to do that. To be sure, it covers quite clearly the requirement to disclose conflicts of interest and place the clients’ interests ahead of your own, but it doesn’t really get into how you know you’re doing that. It’s much like in the Great British Baking show during the technical challenge in the final round when the recipe card just says “Make Phyllo Dough”. Technically a clear instruction, just lacking in the details. The next professional credential I pursued then was the Accredited Investment Fiduciary (AIF®) designation, which is a stringent study of the laws and acts that govern the best practices and processes of managing money for individuals, trusts, and businesses. This professional designation lays out a clear framework not only for providing fiduciary investment advice but also for the ongoing management of fiduciary responsibility on the part of the investment advisor and the fiduciary clients they’re assisting (trustees, plan sponsors, etc.). As a brief disclosure, I was selected in 2018 and again in 2019 to assist in writing the questions for the AIF® exam, so this credential has also come a bit closer to my heart.
Then things get scary
Of course, life isn’t all ideal financial planning cases. Not everyone is a married couple with kids on full scholarship to great schools with enormous life savings and clear financial goals! In fact, many people will struggle to accomplish even basic financial goals, and often the hindrance rather than help is the person by their side! Early last year I took on the task of obtaining the Certified Divorce Financial Analyst (CDFA®) credential, as divorce is one of the 72 topics of the CFP® Certification, but Divorce is complicated on a state-by-state basis and moreso by the fact that it’s an ever evolving field. The CDFA® is a professional designation I’d love to let sit on the shelf, but life happens to all of us, so it’s there when needed to help clients move onto the next stage of life when the unfortunate befalls their relationships.
Just for Clarity
The next designation I studied admittedly might have been a bit petty. You see, the CFP® Certification has been around for decades and has had a rival for just as long, the Chartered Financial Consultant (ChFC®) charter. While both cover almost the exact same topics, most financial planners go about obtaining one and then as is human nature, declare the one they have the better of the two. Well, not one to leave a stone un-turned, I decided to revisit my CFP® Professional roots and complete the ChFC® curriculum to settle the debate for myself. While the ChFC® covers in greater detail some contemporary educational topics such as behavioral finance and special needs financial planning, it lacks the same substantive experiential, educational, and ethical requirements as the CFP® (in addition to breaking up its tests course by course rather than a comprehensive exam). Having completed and obtained both, I tell any financial planner that the CFP® is where it’s at, but for those coming from unconventional backgrounds, the ChFC® can provide some decent base knowledge.
So is that enough letters behind your name?
No! Loathe as I am to admit it, I’m currently coveting the education behind a number of fascinating professional designations and credentials. The Wealth Management Certified Professional® looks enticing with its comprehensive high level roll-up of financial planning and investment education. The Accredited Estate Planner is quite exciting with its advanced estate planning education. In the corner are the Retirement Income Certified Professional® and the Certified Advisor in Philanthropy® designations, taunting me with their advanced knowledge of late-stage life planning and gifting strategies. Meanwhile the Registered Life Planner® designation is all the rage in helping clients live more meaningful lives via their relationship with money. And of course we haven’t even mentioned that second masters or the PhD programs I’ve been looking at. For better or worse, you’re likely stuck with me getting ever longer email signatures and business cards, because I can’t help but keep excitedly learning more and more to better serve the clients and community that I love. So stick with me, because for however annoying it is to see the alphabet soup of professional designations spilling out behind my name in emails and on letterhead, it just represents one more incredible piece of learning that I can bring to help you accomplish your life goals!