Financial Advisor Blog on Marketing, Lead Generation, Prospecting and Sales

Potential prospects are more readily drawn to financial advisors with financial credentials and financial designations. In a poll of retirees asked what was most important to them in a new advisor, “specialized training” and “a credential evidencing specialized training” ranked 2 and 3 respectively out of 8 choices.

First, a financial designation implies that you think enough about what you do to get some extra training or experience, i.e. you are serious and committed to your own profession. Would you rather get your tax problems solved by Joe Bean, Accountant, or Joe Bean, CPA? You may not even know what the qualifications are to become a CPA but you automatically assume that the professional with a financial designation has raised themselves to a higher level of expertise, expertise you want for your benefit. You also assume that this individual is committed to their profession.

Compare this to the average person in financial services who has no financial credential. Can we assume that they are just interested in the next sale, in making a living and have little commitment to their “profession?”

Secondly, in financial services, the public has come to see people in the industry as sales people. Financial services has never become a profession because most people in the industry are not professionals. Before you get insulted, let me give you one definition of a professional. A professional is committed solely to the prospect’s agenda. When you go to your doctor, he is committed to making you well. He has no agenda to sell you drugs, medical devices or a surgical procedure. The same is true of CPAs and attorneys—they are committed to your agenda. But people in financial sales always have their own agenda—to sell a product or service and the public knows it. Therefore, a financial designation helps separate you from the sea of salespeople and to appear as a professional.

Third, the public assumes that the credentialing organization provides oversight of your activities and that you operate at a higher standard than your un-credentialed competitors. In the public’s eyes, not only have you met some initial standards for the financial designation, but you have kept your record clean. This is true. The CFP® Board, the state Board of Accountancy, the State Bar association regularly censures or defrocks illegitimate members holding their designation. This gives the public a high comfort level in dealing with financially credentialed professionals. Would you rather go to any plastic surgeon or a “board certified” plastic surgeon (even though your don’t know the board or how a physician gets to be board certified).

Fourth, maintaining a financial designation requires continuing education in every field. The public would rather use the services of someone who is up to date than someone who may have gotten their license 20 years ago and now has outdated expertise.

Fifth, the designation turns an unknown (you) into a known. No one knows if Joe Bean, financial professional is a good and honest guy. He is an unknown. And if you want to see prospects procrastinate, just give them uncertainty. The more certainty you add about yourself, the faster prospects commit. A financial designation is a method of adding certainty, solidity and making people feel more comfortable dealing with you. And since people make their decisions emotionally, you want them to feel comfortable.

One important caution—do not get bogus financial credentials. There are plenty around that have no substance, do not have proctored exams and are a false front to give psuedo-credibility where none is due. For example, I received a fax about the Certified Retirement Planner designation in order to “put an end to the embarrassment of presenting yourself as an insurance agent…in less than 30 days, you can become a Certified Retirement Planner , doubling your income almost immediately.”

You can bet that there is no substance to this program, no rigor, no proctored exam, no CE requirements, no State Insurance CE, no recognition by the CFP(r) Board or The American College. In fact, use of this designation may even be illegal in many states. So get a legitimate financial credential that illustrates your expertise.