In financial services, perhaps the most powerful trend of modern times has been the growth of objective financial advice. Among evidence supporting that claim is a research study published by LIMRA International earlier this year, based on a survey of 708 affluent households. Entitled Financial Advisors and Institutions Serving the Affluent, the survey asked these households to identify their "Primary Financial Advisors." Of the 45% of households that identified a professional (instead of family, friends or self), the leading providers were as follows:

• Certified Financial Planners (CFPs) were named by 43% (of the 45%).
• Stockbrokers were named by 30%.
• CPAs were named by 16%.
• The remaining 11% divided among personal bankers, insurance agents, trust officers and lawyers.

Some perspective is useful. Stockbrokers and CPAs have been around a long time, and both professions have spent vast amounts of money to convince consumers why they should be chosen as advisors. CFPs have only existed for 28 years-and for most of that time they worked in the proverbial "cottage industry." Yet, almost as many affluent households now call CFPs their primary advisors as mention stockbrokers and CPAs combined.

Since 1982, the life insurance industry has worked to create its own version of the CFP designation, the Chartered Financial Consultant (ChFC). But even with 40,000 professionals holding the ChFC designation, affluent households rarely mention any insurance professionals (much less ChFCs) when identifying primary advisors.

Two Faces of Objective Advice

I think there are two important reasons why the CFP designation has grown from obscurity into the 800-pound gorilla of financial advice. The first reason was a decision made two decades ago that this designation's education program would not be owned or controlled by any institution or industry. Today, CFP education is taught by more than 200 accredited institutions in the U.S. and Canada, all of which are independent of industry influence. This is in contrast to the ChFC, which is still controlled by the American College and affiliated with the life insurance industry.