Financial planners and their clients… a huge responsibility awaits

01 June 2020 Rianet Whitehead
FPI’s CEO, Lelané Bezuidenhout

FPI’s CEO, Lelané Bezuidenhout

The Financial Planning Institute (FPI) did a survey amongst its members to get the real picture of the fears, concerns and plans their members have and are facing, daily, with their clients after COVID19 struck. An article outlining all of this was shared with FAnews; it is incredible how fast life changes and how quick we as humans can adapt. Read the article and realise that we all have similar concerns… at the end of the day it’s about how you handle and approach those concerns.

The impact of COVID19 on CFP® Professionals and their clients

Instead of making sweeping (and potentially inaccurate) generalisations about the impact of Covid-19 on the financial planners and their clients, the Financial Planning Institute (FPI) surveyed CFP® Professionals to find out what’s really happening on the ground. Their findings make for fascinating reading…

An impressive 761 CFP® Professionals completed the online survey conducted during April 2020 throughout Southern Africa. Most responses came from Gauteng, the Western Cape and Kwa-Zulu Natal, but all nine provinces and several neighbouring countries were represented. The survey underscores the FPI’s commitment to ensuring that South Africans have access to the services of competent, ethical financial planners who adheres to a professional code of ethics.

Making the most of the “new normal”

The survey provided concrete evidence that the Financial Planning industry was hit to some extent by the pandemic but not as hard as many other sectors of business. While the pandemic has changed how all CFP® Professionals work, a heartwarming 56% of respondents said the pandemic would not change their long-term professional or personal goals. “My business remains the same, I just have to be nimble and able to adjust the way I do it!” said one, especially chipper respondent. Meanwhile, 19% of those surveyed said Covid-19 caused them to consider postponing their own planned retirement date and working longer.

Regarding the challenges presented by the pandemic, a full quarter of respondents listed establishing relationships with new clients as their primary concern while a further 21% stated planning for the upcoming economic recession as their biggest worry. Other factors troubling South African CFP® Professionals include:

  • Conducting client meetings by phone or video conference and not in person. 16%
  • The emotional factor. Clients are leaning on me as a therapist first. 11%
  • Balancing the needs of my clients with my own personal/family needs. 11%
  • Maintaining more frequent communications with clients and prospects. 9%
  • Working remotely. 8% 

The responses to this section of the survey underline the fact that Financial Planners who are open to technology – specifically digital marketing, cloud-based software and video conferencing technology – have found the fallout of the pandemic easier to manage. As one respondent put it, “Change is inevitable. It is a great opportunity to see ‘crisis management plans’ in action and to see where we can improve on processes. Obviously, we do expect challenging times, but there will also be a lot of new possibilities.” 

Advice in the midst of the pandemic 

Many readers will be wondering how they should react in the face of tumbling share prices and seesawing exchange rates. More than two-thirds of the 761 CFP® Professionals who completed the survey say that their advice to clients is to “sit tight and wait until volatility decreases before making any major financial decisions.

Proving that financial planning is as much about people as it is about numbers, more than four-fifths of respondents expressed concern at their clients’ mounting stress levels. Across the board, the five biggest client concerns are: 

  1. Unemployment or reduced income
  2. Protecting assets
  3. Managing debt
  4. Liquidity/cashflow
  5. Rent/mortgage payments. 

When everything you’ve worked so hard to achieve is disappearing before your eyes, it can be very tempting to try and take financial planning matters into your own hands,” says the FPI’s CEO, Lelané Bezuidenhout. “Clients should resist the temptation to do this and speak to their financial planner and if they do not have a planner, to refer to to find an FPI professional member in their area.”   

A huge responsibility awaits 

One thing that unites all CFP® Professionals is their conviction that the pandemic – and the associated economic impacts – has made the financial planning profession more important than ever. A whopping 91% of respondents agree that South-Africans with a financial plan are more likely to make progress towards their goals, even during these uncertain times.

As a result, 61% of financial planners believe that there will be a growing demand for financial advice delivered by a professional in the wake of COVID-19. Already, over a third of respondents have seen an increase in client queries, but this is set to grow exponentially as the public health crisis makes ways for an economic one. “This is a tough time for all,” says Bezuidenhout, “but CFP® Professionals around the country are not shying away from the challenge of improving the financial wellbeing of all South Africans and their families even during turbulent times like this.”

We wouldn’t want it any other way.

Writer’s thoughts:
It was interesting to read that one of the biggest troubling factors for financial planners was the fact that they could not meet face to face with clients. It does not matter how easy a Zoom or Teams meetings are, or how you can say exactly the same thing over a telephone, the face to face part of a planner’s job is the part where the real connection takes place, where non-verbal communication is much more visible… and where empathy and sympathy is so much easier to convey than doing it over a virtual meeting or a telephone call. The human touch will always be irreplaceable. Please comment below, interact with us on Twitter at @fanews_online or email me us your thoughts [email protected].

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