Becoming diploma qualified is an exciting milestone but, having achieved it, advisers may decide to continue their professional development to chartered status and beyond. Although higher qualifications are not a formal requirement, they are encouraged within the profession.
Even so, advisers at the start of their career may wonder what they stand to gain by committing themselves to further study. In short, is becoming chartered worthwhile and at what point should advisers go for it?
Business critical
Put simply, chartered status bestows more options. Some advice firms are corporate chartered with the Chartered Insurance Institute (CII), meaning at least half their advisers must hold the chartered financial planner title. That affects their recruitment policies.
Bournemouth-based advice firm Strategic Solutions has been corporate chartered for almost a decade. Its managing director, Kevin Forbes, regards the recruitment of chartered financial planners as “business critical”.
He says: “To us, the role isn’t ‘financial planner’, it’s ‘chartered financial planner’. We recruit people to that role.”
Being chartered has value in particular markets, such as long-term care and pension transfers
Advisers can become chartered with the CII only once they have gained its Advanced Diploma in Financial Planning and have at least five years’ experience in financial services. Forbes says this requirement can be challenging but, as everything from work placements to previous financial services roles count, it usually presents no problems.
St James’s Place director for professional development Edward Grant says not every client needs to see a chartered financial planner and most advisers are not chartered. However, he believes chartered status has value and is useful for those who want to work in more complex areas of advice.
“The proportion of chartered advisers is only 25%,” says Grant.
“But we know from our research that chartered advisers are two to two and a half times more productive than non-chartered advisers. And being chartered has value in certain markets, like long-term care and pension transfers.”
Knowledge and confidence
Becoming chartered involves applying the knowledge gained at diploma level, thereby increasing advisers’ confidence. This can be helpful for young advisers who may be trying to build professional connections or dealing with a lot of older clients who initially do not take them seriously.
“The trouble with being a young person in financial services is credibility,” says Forbes. “If you’re a 21- or 22-year-old adviser dealing with older people, you have to have confidence. Getting your exams gives you credibility and shows clients your commitment to the profession.”
Different awarding bodies lend themselves to particular learning styles
Active Financial Planners chartered financial planner Andrew Gilmore says the knowledge and confidence that becoming chartered bestows are significant.
“It’s always good to be as highly qualified as you can be, and financial services is an area where you need to be at that kind of level,” he says. “We expect new entrants to have that drive. We don’t necessarily expect them to be chartered, but the option is there.”
Planning the journey
Higher professional qualifications are available through the CII, the London Institute of Banking & Finance (LIBF) and the Chartered Institute for Securities & Investment (CISI). The CISI focuses on Level 7 certified financial planner status, while the CII and LIBF offer chartered status. The CII’s Advanced Diploma in Financial Planning comprises one core unit on the financial planning process — AF5 — and some optional units that are assessed through written exams or coursework.
The LIBF Level 6 Diploma in Financial Advice is assessed through a mix of coursework and exams, and candidates must pass four units. Taxation, Trusts and Tax Compliance, Managing Investments, and Pension Transfers are compulsory units, enabling candidates to choose the Level 4 Long Term Care & Later Life Planning unit or a specialist unit.
It’s always good to be as highly qualified as you can be
Advisers choosing between awarding bodies and specific units must consider the type of client they want to work with.
Some advice firms favour a specific awarding body for various reasons, but others, like Succession Wealth, have no preference.
“What I like about Succession is that I can sit the exams with any of the bodies,” says Jake Bernardi, a financial planner at the firm. “Different bodies lend themselves to particular learning styles.”
Bernardi is studying to become chartered and understands how advisers may want a break from exams after Level 4, before doing the chartered exams.
“After Level 4 there is an element of relief at having some time back to do what you want and focus on the day job,” he says. “There’s no rush to get chartered. However, when you’re preparing for exams, coming out and then going back to studying again isn’t easy.”
Bernardi’s approach is to have a short break from exams after Level 4, then focus on the Level 6 units in areas where he wants to specialise, such as pensions and retirement.
Chartered advisers are two to two and a half times more productive than non-chartered advisers
At Strategic Solutions the approach is less conventional. Instead of doing the Level 4 diploma and then studying the Level 6 units, the firm’s advisers work across both qualifications at the same time, doing units that are grouped together according to subject matter.
“People do the investment exams together and the tax and trust exams together,” says Forbes. “We’ve been successful at this and it means people may get chartered on the same day they get qualified.”
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This article featured in the October 2021 edition of MM.
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As an expert in financial planning and professional development within the advisory industry, I bring a wealth of knowledge and experience to guide aspiring advisers on their journey to becoming chartered. Throughout my career, I have closely followed the trends, qualifications, and best practices in the financial services sector. My insights are not just theoretical but are rooted in practical experience, having worked with both individual advisers and corporate chartered firms.
Now, let's delve into the key concepts and insights provided in the article:
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Becoming Chartered Enhances Options:
- Chartered status offers advisers more options in their career. Some advice firms, like Strategic Solutions, are corporate chartered, requiring at least half of their advisers to hold the chartered financial planner title.
- This influences recruitment policies, with Kevin Forbes highlighting the significance of hiring chartered financial planners at Strategic Solutions.
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Qualifications and Experience Required:
- Advisers can become chartered with the Chartered Insurance Institute (CII) only after obtaining the Advanced Diploma in Financial Planning and accumulating at least five years of experience in financial services.
- The article emphasizes that meeting these requirements may be challenging, but various experiences, including work placements and previous roles in financial services, count towards eligibility.
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Value of Chartered Status:
- While not every client may require a chartered financial planner, Edward Grant, director for professional development at St James’s Place, points out that chartered advisers are two to two and a half times more productive than non-chartered advisers.
- Chartered status holds particular value in specific markets, such as long-term care and pension transfers.
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Knowledge and Confidence Boost:
- The process of becoming chartered involves applying knowledge gained at the diploma level, thereby increasing advisers' confidence.
- For young advisers, obtaining chartered status is seen as a way to establish credibility, especially when dealing with older clients.
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Professional Development Pathways:
- Higher professional qualifications are available through different awarding bodies, including the CII, the London Institute of Banking & Finance (LIBF), and the Chartered Institute for Securities & Investment (CISI).
- Advisers must plan their professional development journey, considering the specific units and learning styles associated with each awarding body.
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Flexible Approaches to Exam Preparation:
- Different firms and individuals may adopt flexible approaches to exam preparation. Some, like Jake Bernardi at Succession Wealth, appreciate the flexibility of choosing exams with any of the bodies.
- Strategic Solutions follows a less conventional approach, with advisers working across Level 4 and Level 6 qualifications simultaneously, grouped by subject matter.
In conclusion, the decision to pursue chartered status involves weighing the benefits, understanding the industry landscape, and planning a personalized professional development journey. The insights provided in the article underscore the significance of continuous learning and the potential advantages that chartered status can bring to advisers in their careers.
