While I am a well-known critic of the UK financial services regulatory regime, there are some aspects of it which I like.
The RDR was not welcomed by many IFAs, mainly because of the need to attain the minimum qualification standard of QCA Level 4.
Most people do not like change and none of us welcome being forced to obtain further qualifications or gap-fill merely to remain in business or to retain authorisation to advise in certain specialist areas.
It is very frustrating, especially when other professionals such as solicitors and accountants do not have to put up with this. CPD usually suffices in other professions.
But research shows that one of the things clients value most, and are willing to pay a fee for, is an adviser’s expertise.
Trust is highly valued too. What better way to prove you have these skills and attributes than to become well qualified and a member of one or more professional bodies which support those qualifications?
Depending on your specialisms, options for professional qualifications include: chartered financial planner, certified financial planner, associate of the Society of Trust and Estate Practitioners, associate of the Chartered Institute for Securities and Investment, Cert PFS (Securities) or chartered wealth manager.
Interestingly, once you obtain a higher-level qualification such as chartered or certified financial planner, you often qualify for a number of examination or qualification exemptions.
I particularly like the chartered qualifications, if only because the public understand the word “chartered”.
It is a trusted brand. They can associate it with other chartered qualifications such as chartered accountant, chartered surveyor or chartered marketer. So it puts you on the same level as these other professionals in the eyes of clients.
And it is not just about the expertise and knowledge you acquire from these professional qualifications. You are also subject to very high professional ethics and integrity standards.
Again, I believe the public like this.
Interestingly, the CISI has a test on integrity which every one of its members has to pass at A grade before they can use their professional qualification after their name. Over 7,000 members of the CISI have already passed the test.
I think this is a good idea and one which other professional bodies should follow.
A further benefit of professional qualifications is that fellow professionals such as chartered accountants relate to you better and treat you as an equal. This has to be a good thing and is likely to lead to more referrals.
I think the minimum qualification level is inevitably going to rise to Level 6 anyway. So the sooner you attain chartered or certified status the better as you will be future-proofing yourself.
The same argument applies to the Step qualifications. It seems highly likely that at some stage in the future you will be obliged to be professionally qualified to draft wills.
The Law Society has been pressing for this for some time.
Finally, there is the sheer feeling of pride and achievement in becoming better qualified. It is good for the ego, which is pretty important these days given the constant criticism and scrutiny we get in financial services.
Tony Byrne is financial planning director at Wealth and Tax Management