1969 was a year to remember. We saw the first moon landing, the peaceful gathering of youth at Woodstock and the birth of the financial planning profession.

According to Denby Brandon and Oliver Welch, authors of The History of Financial Planning, on December 12, 1969, 13 men gathered at a hotel meeting room near O’Hare Airport in Chicago to discuss more effective ways they could help people make sound financial decisions.

The next 50 years have seen an evolution of that basic idea and a veritable revolution that has changed the way the public interacts with its finances. It was evident to those at the O’Hare meeting that clients benefit more when professionals help them integrate the various aspects of their finances—and not as much when professionals try to address the issues in piecemeal form through product sales.

Since then, we have seen the creation of the International Association for Financial Planning (IAFP); the College for Financial Planning; the CFP designation; the Institute of Certified Financial Planners (ICFP); the International Board of Standards and Practices for Certified Financial Planners Inc. (IBCFP), now known as the CFP Board; NAPFA; the Foundation for Financial Planning; and the Financial Planning Association.

There also evolved a code of ethics, practice standards, and disciplinary rules and procedures. Financial planning education programs were established in addition to the college. The International CFP Council, the Financial Planning Standards Board and the Center for Financial Planning were created, and a comprehensive certification exam was introduced.

A decade ago, the FPA successfully sued the SEC to maintain the line between advice and sales. Today, the real financial planning profession doesn’t even question the importance of a bona fide fiduciary standard of care.

It wasn’t all smooth sailing. Far from it. During my career, the “CFP Lite” fiasco in 1999 scarred the profession like nothing else. The way it was rolled out damaged trust and faith in the body charged with keeping standards high. The series of CEOs at the CFP Board that followed did little to instill confidence. The organization is still feeling the ramifications today as it tries to balance its need for confidentiality in many matters like disciplinary hearings and its need to engage the profession in dialogue on important issues.

Today’s Profession

Clearly, there is a lot for professional financial planners to be proud of today.

There have never been more CFP license holders in the U.S. and abroad. Never has there been more research into all aspects of financial planning nor more registered programs and financial planning degree programs in colleges and universities educating new practitioners. Never more countries affiliated with the Financial Planning Standards Board. Never more pricing models and never more clients being served.

The financial planning profession has never been needed more. Seasoned financial advisors may question whether the Financial Independence-Retire Early (or FIRE) movement is realistic, but the fact that a subset of millennials has bought into the notion of financial independence at such a young age speaks volumes to the concept’s power.

Personal finance just gets more complex, and people feel more money responsibility fall on their shoulders. As more and more consumers understand what professional financial planning is all about, the demand is soaring and causing the financial planning profession to innovate with new service and pricing models, changing the financial service industry as it attempts to shift to a planning orientation.

One hallmark of a true profession is that it addresses a society-wide need. Prompted by financial advisor advocates, financial literacy programs have been mandated in more school systems, in more states, than ever. This reflects the societal importance of people’s ability to make financial decisions. More planners are engaged in pro bono efforts, another sign of the industry’s professionalization.

But there has also never been more responsibility on the shoulders of planners. Those of us seeking to professionalize planning have long advocated that a true fiduciary standard is the only one that makes sense for it. And we believe those practitioners whose regulatory status doesn’t require them to work under a formal fiduciary standard should conduct their business as though they do anyway.

The CFP Board’s new standards certainly suggest that. Most practitioners I know don’t have a problem with a fiduciary standard—it’s their employers that do. Sadly, the Securities and Exchange Commission seems to be focused on helping sales organizations fight the movement toward fiduciary advice.

The SEC has tried to clear up some of the confusion with its “Regulation Best Interest” (what some of us call “Reg BS.”) Its very name and the new Form CRS (the client relationship summary disclosure) will confuse consumers even more. The agency’s new videos for clients do a decent job covering the differences between brokers and advisors, yet also suggest both are held to the same standard of care. What’s worse is the agency’s interpretation of what is “solely incidental” when a broker-dealer is giving advice that ought to be regulated under the Investment Advisers Act of 1940. The language defies logic, common sense and the intent of Congress when the ’40 Act was passed.

What’s next?

Future: A Profession In Peril

We have come a long way, but this is a scary time for the profession. The public needs our help more than ever, but there are forces making it more difficult for people to get the advice they need. The profession has needs too.

A diverse potential client base is best served by a diverse array of practitioners, and meeting the public need for help starts on campus. We need more educational institutions to elevate financial planning to an academic major of prominence. That only happens if the programs draw more enrollment, and that happens, in turn, when students get jobs. On many campuses, the dominant presence is not professional planners—it’s the big financial services companies looking to fuel their sales machines. We need practitioners on campus to boost awareness, recruit students and educate them (and their parents) about the existence of the profession and what professional planners actually do.

We also need more planners to grow the profession and improve the succession prospects of true professionals. If we aren’t careful, the private equity money and other large institutions buying up practices will take over the delivery of a very personal service and neuter the ability of practitioners to personalize what they do and be as effective. Sound harsh? Take any doctor over age 55 to lunch and ask how medicine has changed in the last 30 years as various groups have bought out private practices. Chances are good those doctors will say that they face impediments to truly caring for patients and delivering the best care, and they are not happy about it.

We need member organizations to become stronger and expand their services to better serve members as the landscape continues to change. The FPA recently set itself back with a bad rollout of a worthy project—revamping its chapter system. I don’t think it will harm the organization as much as “CFP Lite” hurt the CFP Board, but there is damage there that will take time to repair, and I fear that while the FPA spends so much time, energy and resources on the chapter issue, other critical issues may be neglected.

The association once had the means and the will to stand up to the SEC. Do the FPA and its Financial Planning Coalition partners have that now?

Is the profession going to let stand the commission’s nonsensical interpretation of “solely incidental”? That phrase is how the ’40 Act determines the behavior of brokers who might begin to act as advisors. They can provide that advice and not get caught up in the regulators’ crosshairs as long as the advice is, again, “solely incidental.” In its Release No. IA-5249, the agency states that broker-dealers’ advice meets the definition of “solely incidental” if provided “in connection with and is reasonably related to the broker-dealer’s primary business of effecting securities transactions.”

If the advice is coming from a B-D, how can it not be “in connection with and is reasonably related to” the B-D’s primary business? If that language is allowed to stand, there is no advice that can come from a B-D that would be subject to the more rigid ’40 Act rules other than discretionary advisory accounts. The SEC does not have the right to rewrite the law. Who will call them on this?

Our profession has a sounder foundation today in large part because of the CFP Board’s advances over the years. We now have an excellent set of high standards for license holders. But the organization is also facing a critical situation after an exposé in The Wall Street Journal by Jason Zweig that showed a site the CFP Board ran lacked Finra disclosures about complaints and disciplinary actions against advisors.

High standards lose their meaning if we do not have effective enforcement. The Journal’s high-profile exposure of this gap is embarrassing and angers me, frankly. There is too much of a mismatch between what the CFP Board says it’s doing to vet its mark holders and what it has actually been doing to ensure that promise is kept.

Nonetheless, there is another implication of the Journal piece to note. Assuming the board tightens things up, the “designation wars” of old are over, and the CFP marks have won. The Journal could have written about any of the other designations, but the author chose to go after the CFP license, clearly because it’s the leader. To paraphrase Winston Churchill, the CFP marks are the worst thing out there—except for everything else.

I am happy the CFP Board is taking immediate action to get to work on the issue. Its initial steps seem reasonable—the board is adding links to BrokerCheck and the SEC’s Investment Adviser Public Disclosure database to its online listings and it’s establishing a task force. I am still pissed, but also hopeful.

But it’s also critical that the CFP Board raise its enforcement game, because the biggest missing piece in the quest to professionalize financial planning is a separate regulatory body focused on financial planning. At this juncture, planners are regulated for things besides the actual financial planning role.

Only the CFP Board is even close to taking on all the tasks a separate regulator would need to, with all the pieces in place. Mind you, I have no idea if that is what the board aspires to, but it’s the best the public has.

Financial planning is not a means to facilitate the sale of financial products. It is a professional endeavor that serves clients by helping them make the best decisions possible. Regulators don’t seem to get that.

A proper regulatory regime would require licensees to prove competence, maintain competence, adhere to procedural standards, adhere to ethical standards at a bona fide fiduciary level and enforce those standards with punishments commensurate with the offenses.

The CFP Board looks pretty good on most of these items. It may be that The Wall Street Journal fiasco has cast doubt on how well the board can provide the enforcement needed. Time will tell. I believe the board can tighten up its enforcement functions, but only to a point. It will still lack the legal muscle needed to mete out punishments such as fines, payments to victims, disgorgement of ill-gotten gains, suspensions or bans from practice, or imprisonment. Some offenses call for such punishments.

Even after the board fixes its mess, it will only be able to restrict the use of the marks. The reformation of the board’s enforcement would further solidify the marks as those of the profession, but the board must go further.

While there are a number of forces that can swamp the ship, I remain optimistic. The strongest force affecting us is consumer demand, and no amount of faux planning enabled by regulatory BS can stop it. People will see through the ruse as they have more and more over the last couple of decades and vote with their feet—taking their hopes, dreams and hard-earned assets to where they are best served. It will just be harder for them to see the facts.

If you fancy yourself a professional financial planner, the profession needs you to stave off the challenges and move the profession forward. If you haven’t already, earn the right to use the CFP marks and volunteer to be subject to their rules, even if you think you don’t need those marks or found the Journal piece disturbing.

Whether you are a CFP licensee or not, join the FPA (and the National Association of Personal Financial Advisors if you are fee-only), even if you don’t like your local chapter or what the national organization has done or not done. These coalition partners are the only organizations that will advocate for the financial planning profession specifically. If that were the only service provided, it would be well worth your licensing fees and dues.

Those 13 men that met in Chicago in 1969 were right. Financial planning is different and makes all the difference. If we professional planners don’t continue to fight for our ideals, the movement to professionalization could get squashed by the monied forces of the financial services industry, and the public will continue to get less than it needs and deserves.

Dan Moisand, CFP, is a principal at Moisand, Fitzgerald & Tamayo in Melbourne, Fla. He served as past president of the Financial Planning Association. He can be reached at [email protected].