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2009

2009 National ConsumerSurvey on Personal Finance

Mission Statement

The mission of Certified Financial Planner Board of Standards, Inc. isto benefit the public by granting the CFP® certification and uphold-ing it as the recognized standard of excellence for personal financialplanning.

Table of Contents

1. Introduction 2

2. Survey Methodology 3

3. Respondent Characteristics 4

4. Core Questions 8

5. Baseline Perceptions and Behaviors 13

6. Respondents Who Have Written Financial Plan In-PlaceWith Involvement of a Financial Professional 16

7. Respondents Who Have Written Financial Plan In-PlaceWith No Involvement of a Financial Professional 29

8. Respondents Who Have No Written Financial Plan In-Place 32

Copyright © 2009, Certified Financial Planner Board of Standards Inc. All rights reserved.

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1. Introduction

Certified Financial Planner Board of Standards (CFP Board) sponsored this 2009 National Consumer Surveyon Personal Finance to establish baseline data on current consumer personal finance and financial plan-ning related attitudes and behaviors.

A nonprofit certifying and standards-setting organization, CFP Board’s mission is to benefit the public bygranting the CFP® certification and upholding it as the recognized standard of excellence for personal fi-nancial planning. Consistent with this mission and its role as a source of expertise on the financial plan-ning profession, CFP Board, from time to time, conducts consumer research to:

• Understand consumer expectations of financial planners and their satisfaction with the financialplanning experience.

• Develop demographic, behavioral and attitudinal profiles of consumers who are using financialplanners and who are likely to benefit from professional financial planning assistance.

• Ascertain the perceived value of financial planning and the CFP® certification by the public.• Gauge shifts in behavior, attitudes and perceptions over time.

It is CFP Board’s hope that the periodic evaluation of the information gained from such research willhelp CFP Board to better fulfill its standards-setting function for the profession and promote consumerunderstanding of the value of financial planning and the CFP® certification marks.

This report summarizes findings in these key areas, describes the survey’s methodology and suggestsimplications that can be drawn from the research results. Questions about the survey results and inquiriesregarding the survey instrument may be directed to CFP Board at:

CFP Board1425 K Street NW, Suite 500Washington, DC 20005P: 800-487-1497F: 202-379-2299E: [email protected]: www.CFP.net

2009 National Consumer Survey on Personal Finance

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2. Methodology

CFP Board’s 2009 National Consumer Survey on Personal Finance was conducted by Westat, one of thenation’s largest and most well known survey research firms. The survey was conducted among a largeand representative cross section of the U.S. population, as shown in Section 3, so that financial planningsubject matter issues could be assessed from the perspective of all major population demographics in theU.S. The survey was conducted via a self-administered Internet-based questionnaire. Westat collecteddata from 1,742 Internet respondents in mid-May through early June 2009. Section 3 provides extensivedocumentation of Respondent Characteristics and compares these data with data from the U.S. Census.


3

The following tables show demographic and profile characteristics of the 1,742 sample respondents com-pared to those of U.S. population based upon U.S. Census estimates. As shown in these tables, respon-dent characteristics are very representative of U.S. population characteristics in virtually all instances. In thedetailed findings presented in this report, most data are analyzed by Educational Achievement, HouseholdIncome, and Investable Assets.

Table 3.1 Education achievement (S-2)

Table 3.2 Household income (S-3)

1Note: 6% of respondents did not provide Household Income data.

3. Respondent Characteristics

College graduate and graduate degree

Some college or 2-year degree

High school graduate or less

CensusSample

College graduate and graduate degree

Some college or 2-year degree

High school graduate or less

CensusSample

24%

41%35%

23%

44%34%

Over $150,000

$100,001 to $150,000

$50,001 to $100,000

Under $50,000CensusSample

Over $150,000

$100,001 to $150,000

$50,001 to $100,000

Under $50,000CensusSample

34%47%

8%

1

5%

31%54%

10%5%


4

Table 3.3 Investable assets (Q32)

1Note: 18% of respondents did not provide Investable Asset data.2Note: Not Available from U.S. Census.

Table 3.4 Age (S-1/AGEGP)

Over $1,000,000

$100,000 to $1,000,000

Under $100,000

CensusSample

Over $1,000,000

$100,000 to $1,000,000

Under $100,000

CensusSample

23%

56%

3%

1 2

65 and older

55 to 64

45 to 54

35 to 44

25 to 34

Under 25

CensusSample

65 and older

55 to 64

45 to 54

35 to 44

25 to 34

Under 25

CensusSample

22%20%

11%

16%14%

17%

20%19%

13%

18%13%

17%


5

Table 3.5 Ethnicity (S-5)

1Note: 1% of respondents did not provide Ethnicity data.

Table 3.6 Gender (S-6)

Other

White or Caucasian

Hispanic or Latino

Black or African AmericanCensusSample

Other

White or Caucasian

Hispanic or Latino

Black or African AmericanCensusSample 1

71%

4%

12%

13%

71%

5%

11%

13%

Female

Male

CensusSample

Female

Male

CensusSample

43% 57% 49% 51%


6

Table 3.7 Regions by state1 (S-4/REGN)

1Regions are defined in the following way.• Midwest – 12 States: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North

Dakota, Ohio, South Dakota, Wisconsin.• West – 13 States: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico,

Oregon, Utah, Washington, Wyoming.• South – 16 States and District of Columbia: Alabama, Arkansas, Delaware, DC, Florida, Georgia, Kentucky,

Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, West Virginia.• Northeast – 9 States: New England States of Maine, New Hampshire, Vermont, Massachusetts, Rhode

Island, and Connecticut; and Mid-Atlantic States of New York, New Jersey, and Pennsylvania.

Sample Census

South37%

Midwest23%West

24%

Northeast16%

South36%

Midwest22%West

23%

Northeast18%


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All 1,742 respondents answered a series of Core Questions which (a) introduced them to the nature andfocus of the survey and (b) resulted in their being classified into one of three respondent groups as de-scribed and presented in Sections 6, 7, and 8. All tables in this section are based on 1,742 respondentsunless indicated differently in a table footnote.

• Section 6: Respondents Who Have Written Financial Plan In-Place With Involvement of aFinancial Professional

• Section 7: Respondents Who Have Written Financial Plan In-Place With No Involvement of aFinancial Professional

• Section 8: Respondents Who Have No Written Financial Plan In-Place

Table 4.1 Assessment of financial planning issues (Q1-1)*

It is clear that most respondents feel that four financial planning issues are most important in theirlives: (1) managing retirement income; (2) providing health insurance coverage; (3) managing/re-ducing current debt; and (4) building a retirement fund.

1Percents show sum of two “most important” response categories on a 6-point scale.*Parenthetical notes refer to the number assigned to questions as they appeared on the survey instrument. The surveyinstrument is available from CFP Board upon request.

4. Core Questions

Financial Planning Issues Percent1

Generating current income 59

Providing health insurance coverage 55

Managing/reducing current debt 53

Building a retirement fund 51

Building an “emergency” fund 47

Preparing for future medical needs (your or others, e.g., parents) 42

Managing retirement income 40

Providing life insurance coverage 35

Accumulating capital/assets 27

Purchasing/renovating a home 26

Saving for vacation/travel/recreational expenses 25

Managing an unexpected windfall 24

Sheltering income from taxes 24

Managing employee benefits (retirement savings, insurance, health savings accounts, etc.) 23

Building a college fund 22

Building an inheritance for heirs 20

Financing your own business 16


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Table 4.2 Important financial planning issues by respondent education, householdincome, and investable assets (Q1-1)

For the most part, it appears that a respondent’s investable asset level most influences perceptionsof financial planning issues. Respondents with high levels of investable assets give relatively lowimportance ratings on the generation of current income, provision of healthcare coverage, andmanaging debt. Similarly, respondents with high household incomes also give relatively low im-portance ratings on providing healthcare coverage and managing debt. Building a retirementfund is relatively unimportant to respondents with low education and income levels.

1Percents show sum of two “most important” response categories on a 6-point scale.

ImportantFinancial Planning Issues1

Education Income Assets

<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Generating current income 60% 59% 57% 60% 60% 50% 62% 62% 56% 49%

Providing health insurance coverage 57 57 51 56 56 59 46 55 59 44

Managing/reducing current debt 56 58 48 58 54 43 41 61 45 25

Building a retirement fund 49 51 53 46 57 50 55 50 58 51


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Table 4.3 Ability to successfully manage important financial issues (Q1-2)

A relatively large proportion of respondents feel that they have a good (48%) or average (43%)ability to manage financial issues that are important in their lives. Only 9% of respondents felt thatthey have a poor ability to manage important financial issues.

Table 4.4 Ability to manage important issues by respondent education, householdincome, and investable assets (Q1-2)

For the most part, respondent ratings of their ability to manage important financial issues do notvary by respondent education levels. However, respondents with higher household incomes andmore investable assets rate their ability to manage important financial issues at higher levels thantheir counterparts in other categories.

Ability


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Very good 20% 20% 20% 18% 21% 19% 29% 16% 26% 40%

Good 23 32 30 23 29 40 44 25 34 46

Somewhat good 29 26 30 29 30 26 21 32 27 11

Somewhat poor 16 14 12 18 12 10 3 17 8 2

Poor 5 5 4 6 5 1 2 6 2 2

Very poor 6 2 2 5 3 3 0 4 2 0

Ability to Manage Percent

Very good 20

Good 28

Somewhat good 29

Somewhat poor 14

Poor 5

Very poor 4


10

Table 4.5 Currently have a written financial plan (Q2)

Two-thirds (64%) of respondents in this survey do not have a written financial plan in-place toguide their personal financial affairs Conversely, only 17% have a written and regularly updatedfinancial plan in-place. Some respondents have a financial plan that is not updated regularly (8%)or had a plan in-place in the past but not at the current time (11%).

Table 4.6 Written financial plan by respondent education, household income, andinvestable assets (Q2)

Respondents with at least a college degree, those with higher household incomes, and those withmore investable assets are more likely to have a written financial plan in-place than their counter-parts with lower education, income, and asset levels.

Financial Plan


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

In-place and regularly updated 11% 18% 23% 11% 20% 28% 33% 11% 30% 38%

In-place but not updated in past year 4 10 10 6 9 11 12 6 13 16

In-place in the past 8 13 13 9 12 11 17 11 11 11

No, never had a plan 77 59 54 74 59 50 38 72 46 35

Financial Plan In-Place Percent

Yes, written plan in-place now and updated regularly 17

Yes, written plan in-place now but not updated in past year 8

No, not now but a written plan was in-place in the past 11

No, never had a written plan in-place 64


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Table 4.7 If Financial Plan In-Place Now or in the Past: Financial planning resourcesused for plan development (Q3)

Many respondents with a written personal financial plan used an “outside” financial professional(38%) to develop their plan though a larger percent of respondents (42%) chose to develop theirfinancial plan using their own capabilities (including those respondents who develop their ownplans and those who use planning software as part of their personal financial planning efforts).Family members who are (8%) and who are not (12%) financial professionals assist some respon-dents in the development of financial plans.

1Percents based on 621 respondents.

Table 4.8 Use of “outside” professional or own plan development by respondenteducation, household income, and investable assets (Q3)

Respondents with at least a college degree, those with higher household incomes, and those withmore investable assets are more likely to use an “outside” financial professional than their counter-parts with lower education, income, and asset levels.

Financial Resources Percent1

Working with an “outside” financial professional 38

Developing your financial plan on your own 37

Working with a family member or friend who is not a financial professional 12

Working with a family member or friend who is a financial professional 8

Using planning software or an Internet-based application on your own 5

Financial Plan


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

In-place and regularly updated 26% 30% 49% 26% 39% 54% 53% 25% 53% 67%

In-place but not updated in past year 46 42 29 50 33 18 33 49 21 17


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All 1,742 respondents were asked a series of questions that examined their perceptions of credentials infinancial planning and information sources used to gain financial information.

Table 5.1 Awareness of certifications, licenses, and official designations (Q26)

Respondents have the greatest current awareness of the CPA (53%) and CFP® certification (28%)credentials though 40% of all respondents were not aware of any credential for financial profes-sionals.

1Data show percent of 1,742 respondents who selected each response category and, as a result, multiple responseswere permitted and column does not sum to 100%.

Credentials for Financial Professionals Percent1

CPA (Certified Public Accountant) 53

CFP® (CERTIFIED FINANCIAL PLANNER™) 28

CFA (Chartered Financial Analysis) 13

CLU (Chartered Life Underwriter) 12

PFS (Personal Financial Specialist) 10

RIA (Registered Investment Advisor) 10

ChFC (Chartered Financial Consultant) 5

Not aware of any credential 40


5. Baseline Perceptions and Behaviors

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Table 5.2 Awareness of certifications, licenses, and official designations byinvestable assets (Q26)

It is clear that awareness of certifications, licenses, and official designations for financial profession-als is related to the level of a consumer’s investable assets (i.e., greater awareness levels if foundamong consumers with over $1 ML in investable assets).

1Percents are responses for each certification in Table 5.1 by respondent’s investable assets.

Table 5.3 Single certification, license, or official designation has best reputation forethical conduct (Q27)

While many respondents (33%) did not express an opinion, the CPA (38%) and CFP® certification(17%) credentials were viewed to be those credentials with the best reputations for ethical conductby most respondents.

1Percents based upon 1,045 respondents who identified one or more credentials in Table 5.1.

Credentials for Financial Professionals

Assets1

Under$100,000

$100,000 -$1,000,000

Over$1,000,000

CPA (Certified Public Accountant) 53% 61% 69%

CFP® (CERTIFIED FINANCIAL PLANNER™) 23 41 49

CFA (Chartered Financial Analysis) 9 21 31

CLU (Chartered Life Underwriter) 9 19 29

PFS (Personal Financial Specialist) 8 13 24

RIA (Registered Investment Advisor) 9 12 18

ChFC (Chartered Financial Consultant) 4 19 29

Not aware of any credential 43 23 25

Credentials for Financial Professionals Percent1

CPA (Certified Public Accountant) 38

CFP® (CERTIFIED FINANCIAL PLANNER™) 17

PFS (Personal Financial Specialist) 3

CFA (Chartered Financial Analysis) 2

ChFC (Chartered Financial Consultant) 2

CLU (Chartered Life Underwriter) 2

RIA (Registered Investment Advisor) 2

Did not select a credential 33


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Table 5.4 Credential with best single reputation for ethical conduct by respondenteducation, household income, and investable assets (Q27)

Respondent ratings on whether the CPA or CFP® certification is the single credential with the bestreputation for ethical conduct do not vary by respondent education, household income, and in-vestable assets.

1Percents based upon 1,045 respondents who identified one or more credentials in Table 5.1.

Table 5.5 Unaided Recall: Thinking about “CFP” – What first comes to mind? (Q28)

A large proportion of respondents (63%) answering this open-end question associate favorableperceptions with the term “CFP.”

1Percents based on 655 total answers from 628 respondents who answered this question (i.e., 62% of all respondentsdid not answer this question).

Best Single Credentialfor Ethical Conduct1


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

CPA (Certified Public Accountant) 35% 44% 36% 38% 37% 36% 42% 37% 38% 38%

CFP® (CERTIFIED FINANCIAL PLANNER™) 15 14 21 15 18 22 19 14 23 24

Don’t know 32 33 34 32 35 33 30 38 26 26

Reaction or Mindset Percent1

Favorable Responses: Educated and qualified professional; provides advice on spending orinvesting money; and manages personal finances and investments for a fee

63

Unfavorable Responses: Question honesty; trustworthiness; legitimacy; capability andtraining; expenses or fees: and value of services

22

Miscellaneous responses 15


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A total of 284 respondents have a written financial plan in-place at present and a financial professionalwas involved in developing these plans. All tables in this section are based upon 284 respondents unlessindicated differently in a table footnote.

Table 6.1 Financial planning needs most important in motivating use of a financialprofessional (Q3)

Four issues most motivate respondent’s use of a financial professional for the development of awritten financial plan: (1) retirement goals and planning; (2) advice on a broad range of financialmatters; (3) savings goals and planning; and (4) investment goals and planning.

1Data show percent of 284 respondents who selected each response category and, as a result, multiple responses werepermitted and column does not sum to 100%.

Financial Planning Needs Percent1

Retirement goals and planning 62

Wanted advice on a broad range of financial matters 48

Savings goals and planning 41

Investment goals and planning 36

Balancing short- and long-term goals and planning 28

Estate planning 27

Cash and debt management 27

Tax planning 21

Insurance planning 17

Education funding 16

Stock option strategies 14

Multi-generational and family planning 12

Charitable giving and philanthropy goals and planning 8

Employee benefits planning 8

Change in marital status 7

Other motivating factors 2


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6. RespondentsWho HaveWritten Financial Plan In-PlaceWithInvolvement Of A Financial Professional

Table 6.2 Important financial planning motivations by respondent education,household income, and investable assets (Q4)

Respondents in each education, income, and asset level subsegment assign a similar degree ofimportance to the four most important financial planning needs identified in Table 6.1.

1Percents show education, income, and asset levels of each respondent who selected the “most important” financialplanning issues in Table 6.1.

Table 6.3 Financial professionals interviewed and selected for development of thefinancial plan (Q5-1 and 5-2)

Respondents most frequently interview-consider and use three types of financial professional whendeveloping their financial plans: (1) CERTIFIED FINANCIAL PLANNER™ professionals; (2) financialadvisors; and (3) accountant/CPAs.

1Data show percent of 284 respondents who selected each response category and, as a result, multiple responses werepermitted and columns do not sum to 100%.

Financial Planning Needs1


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Retirement goals and planning 17% 22% 61% 21% 48% 19% 13% 29% 62% 9%

Wanted advice on broad financial matters 16 23 61 22 46 17 16 32 54 15

Savings goals and planning 22 23 54 24 47 21 8 40 52 8

Investment goals and planning 17 20 63 21 44 22 12 29 61 10

Financial ProfessionalsInterviewed/Considered1

Worked Withor Used

CERTIFIED FINANCIAL PLANNER™ professional 43 38

Financial Advisor 33 25

Accountant/CPA 26 12

Attorney 16 8

Banker 8 5

Insurance agent 7 4

Stock broker 7 3

Financial planner (not certified) 5 2

Another professional 4 3


17

Respondents with Written Financial Plan Developed with Involvement of Financial Professional

Table 6.4 Financial professionals interviewed and selected for the development of afinancial plan by investable assets (Q5-1 and 5-2)

Respondents with investable assets over $1 ML more frequently interview or consider a broaderarray of financial professionals for financial plan development than consumers with lower levels ofinvestable assets. However, consumers in all segments tend to most frequently use a CFP® profes-sional or “financial advisor” for the development of their financial plans.

1Percents are responses for each financial professional in Table 6.3 by respondent’s investable assets.

Financial Professionals

Assets

Under$100,0001

$100,000 -$1,000,0001

Over$1,000,0001

Interviewed/Considered

Worked Withor Used


Worked Withor Used


Worked Withor Used

CERTIFIED FINANCIAL PLANNER™ professional 36% 33% 41% 43% 63% 56%

Financial advisor 28 25 32 27 26 15

Accountant/CPA 19 10 22 10 37 7

Attorney 7 5 12 9 33 15

Banker 11 8 5 4 7 4

Insurance agent 12 7 4 12 7 0

Stock broker 6 2 8 13 7 4

Financial planner (not certified) 11 6 3 1 0 10

Another professional 6 4 3 3 0 10


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Table 6.5 Sources of information used to first learn about the financial professionalused to develop respondent’s financial plan (Q6)

It is clear that interpersonal information sources – recommendations of family members (31%),friends (27%), and co-workers (13%) – are most frequently used by respondents to learn aboutthose financial professionals used to develop their financial plans.

1Data show percent of 284 respondents who selected each response category and, as a result, multiple responses werepermitted and columns does not sum to 100%.

Table 6.6 Financial professional used to develop plan provided credible andcompetent services (Q7)

In overall terms, a large proportion of respondents (80%) felt that their financial professional pro-vided credible and competent services.

Information Sources Percent1

Recommendation of a family member 31

Recommendation of a friend 27

Recommendation of a coworker 13

Internet site listing financial planners 7

Recommendation of a lawyer 7

Recommendation of a banker 7

Recommendation of an accountant 6

Print advertisement or brochure 5

Television or radio advertisement or program 4

Magazine article or listing of financial planners 3

Other 17

Perceptions of Financial Planning Services Percent

Definitely yes 56

Yes 24

Probably yes 11

Probably no 5

No 2

Definitely no 2


19


Table 6.7 Credibility and competent services by respondent education, householdincome, and investable assets (Q7)

Respondent perceptions of their financial professional’s credibility and competency do not vary bytheir education, income, and asset levels.

Table 6.8 Credibility and competent services by type of financial professional (Q7)

Respondents using CFP® professionals, financial advisors, and accountant/CPAs all strongly believethat their financial professional provides credible and competent services.

1Financial professionals identified by respondents in Table 6.3.

Credible-Competent Services


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Definitely yes 61% 58% 54% 55% 54% 63% 70% 57% 55% 67%

Yes 11 26 27 23 24 21 21 21 23 26

Probably yes 9 10 12 11 15 13 3 15 12 4

Probably no 11 4 4 3 7 2 6 4 7 4

No 4 0 1 3 1 0 0 0 2 0

Definitely no 4 1 1 5 1 2 0 5 1 0

Financial Professional1

Credible-Competent Services

Definitelyyes

Yes

Probablyyes

Probablyno

No

Definitelyno





20


Table 6.9 Year current plan put in-place (Q8)

Recognizing that 29% of respondents could not recall a date, a large proportion of respondents(39%) put their written financial plans in-place in the 2001 to 2009 period and another 24% re-ported doing so in the 1991 to 2000 timeframe.

Table 6.10 Respondent benefit from having a written financial plan (Q9)

A large proportion of respondents (65%) strongly believe that they have benefitted from the devel-opment of a written financial plan.

Year Put In-Place Percent

1980 or before 2

1981 to 1990 6

1991 to 2000 24

2001 to 2009 39

Can’t recall 29

Written Financial Plan Beneficial Percent

Definitely yes 46

Yes 19

Probably yes 17

Probably no 7

No 4

Definitely no 2

Don’t know 5


21


Table 6.11 Benefit from having a written financial plan by respondent education,household income, and investable assets (Q9)

Respondent’s favorable perceptions of the benefits of having a written financial plan do not vary byeducation, income, or asset levels.

Table 6.12 Benefit from having a written financial plan by type of financialprofessional (Q9)

Respondents using CFP® professionals, financial advisors, and accountants/CPAs all strongly feelthat they have benefitted from a written financial plan.


Benefit


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Definitely yes 43% 45% 48% 39% 46% 50% 61% 40% 51% 44%

Yes 28 14 19 15 19 27 12 19 16 30

Probably yes 15 16 18 20 15 15 24 21 14 19

Probably no 4 10 8 8 9 6 3 8 8 4

No 4 6 3 3 6 0 0 4 5 0

Definitely no 4 3 2 5 2 2 0 6 2 0


Written Financial Plan Beneficial

Definitelyyes

Yes

Probablyyes

Probablyno

No

Definitelyno





22


Table 6.13 Use of financial professional in current economic environment (Q10)

In the current economic environment, 36% of respondents have tended to use their financialprofessionals to a greater extent than in the past though 44% tend to use their financial profes-sional at present to about the same degree as in the past.

Table 6.14 Length of time working with current financial professional (Q11)

While 19% can’t recall, it is interesting to note that 33% of respondents have worked with theircurrent financial professional between 2 and 5 years while 40% have done so for 6 years orlonger. Only 8% have worked with their current financial professional for 1 year or less.

Financial Planner Use: Increase or Decrease Percent

Definitely greater extent 19

Greater extent 17

Probably greater extent 30

Probably lesser extent 14

Lesser extent 5

Definitely lesser extent 8

Don’t know 6

Number of Years Percent

1 year or less 8

2 to 5 years 33

6 to 10 years 17

11 years or longer 23

Can’t recall 19


23


Table 6.15 Length of time working with current financial professional by respondenteducation, household income, and investable assets (Q11)

Respondents with higher education, income, and asset levels tend to work with financialprofessionals for longer periods of time than their counterparts in other sample populationsubsegments.

Table 6.16 Length of time working with current financial professional by type offinancial professional (Q11)

Accountants/CPAs tend to have particularly long relationships with their clients though, for themost part, CFP® professionals and financial advisors also appear to have solid and multi-year rela-tionships with their clients as well.


Number of Years


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

1 year or less 19% 11% 7% 15% 12% 7% 0% 20% 8% 0%

2 to 5 years 43 39 41 44 43 40 33 45 35 56

6 to 10 years 16 25 21 15 23 23 20 18 24 12

11 years or longer 22 25 31 27 23 30 47 17 34 32

Financial Professionals1 1 Yearor Less

2 to 5Years

6 to 10Years

11 Yearsor Longer

CERTIFIED FINANCIAL PLANNER™ professional 11% 37% 23% 29%

Financial advisor 12 31 26 21

Accountant/CPA 3 31 17 48


24


Table 6.17 Excluding Current Financial Professional: Number of financialprofessionals worked with in the past (Q12)

While a large proportion of respondents indicate that they have not worked with another financialprofessional in the past (43%) or could not recall if they had worked with someone other thantheir current financial professional in the past (16%), most respondents have worked with one(20%) or two (12%) other financial professionals sometime in the past.

Table 6.18 If Worked With Other Financial Professionals in the Past: Reasons forswitching from last to current financial professional (Q12)

It appears that respondents switch from one financial professional to another for a variety of almostequally important reasons though a qualifications upgrade (44%) is viewed to be the most impor-tant factor motivating a change in their relationships with a financial planner.

1Percents are based upon 116 respondents and show sum of two “most important” response categories on a 6-pointscale.

Number of Financial Professionals Percent

None – no other financial professional 43

One other financial professional 20

Two other financial professionals 12

Three other financial professionals 5

Four or more other financial professionals 4

Can’t recall 16

Number of Financial Professionals Percent1

Wanted to switch to a more qualified professional (Q12-5) 44

My financial situation changed (Q12-1) 32

Could not trust advice and recommendations of the previous financial professional (Q12-4) 27

Had a bad experience with the previous financial professional (Q12-5) 27

Previous financial professional was too expensive (Q12-2) 21


25


Table 6.19 Confidence that financial professional used by respondent placesrespondent’s interest ahead of their own interests (Q14)

A large proportion of respondents are confident that their financial professional places theirinterests ahead of their own.

Table 6.28 Confidence that designated financial professional places respondent’sinterests ahead of their own by respondent education, household income,and investable assets (Q14)

Confidence in a respondent’s financial professional to put their client’s interests ahead of their ownvary by respondent education, income, and assets.

Confidence Percent1

Very confident 46

Confident 27

Somewhat confident 16

Somewhat not confident 4

Not confident 2

Definitely not confident 2

Don’t know 3

Confidence


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Very confident 53% 49% 43% 41% 46% 46% 61% 45% 47% 48%

Confident 24 25 29 29 29 23 21 30 25 22

Somewhat confident 15 17 16 15 15 23 9 16 14 22

Somewhat not confident 0 1 6 3 3 4 6 2 5 4

Not confident 2 6 1 3 2 2 0 0 5 0

Definitely not confident 6 1 1 6 2 0 0 5 2 0


26


Table 6.29 Confidence that designated financial professional places respondent’sinterests ahead of their own by financial professional (Q14)

Confidence in a respondent’s use of a specific financial professional does not vary across their useof CFP® professionals, financial advisors, or accountant/CPAs in the development of their writtenfinancial plans.


Table 6.30 Importance of financial professionals meeting requirements (Q15)

Respondents feel that it would be important for financial professions to meet a variety of require-ments, particularly those related ethics and practice standards.


Confidence


CERTIFIED FINANCIALPLANNER™ Professional

FinancialAdvisor

Accountant/CPA

Very confident 44% 49% 54%

Confident 28 24 26

Somewhat confident 18 19 11

Somewhat not confident 4 3 3

Not confident 1 1 3

Definitely not confident 2 1 3

Don’t know 3 3 0

Requirements Percent1

Adhere to a professional code of ethics (Q15-5) 89

Adhere to professional practice standards (Q15-4) 87

Face enforcement and possible disciplinary action for violations of ethics and practicestandards (Q15-6)

80

Fulfill ongoing continuing education requirements (Q15-7) 73

Complete a specified amount of practical financial planning related work (Q15-3) 73

Pass a comprehensive examination (Q15-2) 69

Complete a curriculum specific to financial planning (Q15-1) 68


27


Table 6.31 Preference for compensation of financial professionals (Q16)

While 19% of respondents don’t know, most respondents (38%) prefer to compensate financialprofessionals through fees set at a flat or hourly rate though another 33% of respondents favorfees calculated as a percentage of assets managed by a financial professional for a client.


Compensation Percent1

Fees set at a flat or hourly rate 38

Fees calculated as a percentage of assets managed for a client 33

Commissions based on financial products they sell 23

Don’t know 19


28


A total of 335 respondents have a written financial plan in-place at present though a financial professionalwas not involved in developing these plans. All tables in this section are based upon 335 respondents un-less indicated differently in a table footnote.

Table 7.1 Year current plan put in-place (Q17)

A large proportion of respondents (56%) indicate that they developed their current financial plansin the last 8 years though 27% could not recall when their plan was developed.

Table 7.2 Respondent benefit from having a written financial plan (Q18)

A large proportion of respondents (48%) feel that they derive significant benefits from having awritten financial plan.

Year Put In-Place Percent

1980 or before 1

1981 to 1990 4

1991 to 2000 12

2001 to 2009 56

Can’t recall 27

Written Financial Plan Beneficial Percent

Definitely yes 33

Yes 15

Probably yes 25

Probably no 14

No 4

Definitely no 5

Don’t know 5


29

7. RespondentsWho HaveWritten Financial Plan In-PlaceWith NoInvolvement Of A Financial Professional

Table 7.3 Benefits from having a written financial plan by respondent education,household income, and investable assets (Q18)

Views on the benefits of having a written financial plan do not vary by respondent education,income, and asset levels.

1Data collapsed from a 6-point scale.

Written Financial PlanBeneficial


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

Definitely yes 35% 35% 30% 31% 33% 42% 46% 33% 33% 44%

Yes 11 13 20 15 15 17 5 15 13 0

Probably yes 24 23 28 24 26 25 14 25 28 11

Probably no 11 19 13 15 15 4 27 14 16 33

No 6 3 2 4 4 0 0 4 1 0

Definitely no 6 4 4 6 4 4 5 5 5 0

Don’t know 6 4 3 5 4 8 5 5 3 11


30

Respondents with Written Financial Plan Developed without Involvement of Financial Professional

Table 7.4 Importance of reasons for not working with a financial planner (Q19)

When developing their financial plans, respondents choose not to work with a financialprofesional for two major reasons: (1) expense of services (60%) and (2) uncomplicated financialaffairs (55%).


Table 7.5 Preference for compensation of financial professionals (Q21)

While 27% of respondents don’t know, most respondents with an opinion (45%) prefer tocompensate financial professionals through fees set at a flat or hourly rate.


Reasons Percent1

Financial professionals are too expensive (Q19-2) 60

My financial affairs are not complicated (Q19-1) 55

Many people claim to be financial planners, and it is hard to know who provides the bestplanning services (Q19-4)

40

Could not trust advice and recommendations of a financial professional (Q19-5) 22

Had a bad experience with a financial professional (Q19-3) 19





Don’t know 27


31

Respondents with Written Financial Plan Developed without Involvement of Financial Professional

A total of 1,122 respondents have no written financial plan in-place at present. All tables in this section arebased upon 1,122 respondents unless indicated differently in a table footnote.

Table 8.1 Work with financial planners in any capacity (Q22 and 22-1)

While many respondents (49%) were not able to identify a financial professional they have used inany capacity or as a primary service provider, it is clear that respondents have a tendency to workwith a variety of different financial professionals to a lesser or greater degree.

1Data show percent of 1,122 respondents who selected a response category and, as a result, multiple responses werepermitted and column does not sum to 100%.

2Primary financial professional was identified by respondents who used multiple financial professionals in any capacityand these percents do not include respondents who selected only one financial profession or “used in any capacity.”

Financial ProfessionalsUsed in AnyCapacity1

Primary FinancialProfessional2

Accountant/CPA 9% 26%

Banker 15 24

Financial advisor 7 12

Insurance agent 8 12

Stock broker 4 10

CERTIFIED FINANCIAL PLANNER™ professional 3 7

Attorney 3 5

Financial planner (not certified) 3 0

Another financial professional 7 3

Did not identify a financial professional 49 --


32

8. RespondentsWho Have NoWritten Financial Plan In-Place

Table 8.2 Satisfaction level with financial professionals used in any capacity (Q22-2)

Respondents with experience in working with a financial professional in any capacity feel thataccountant/CPAs, bankers, CFP® professionals, and financial advisors provide services that createthe highest levels of satisfaction.

1Percents are based upon 572 respondents and show sum of two “highest satisfaction” response categories on a 6-pointscale.

Table 8.3 Important reasons for not having a written financial plan (Q23)

Respondents do not choose to develop a written financial plan for four major reasons (1) uncom-plicated financial affairs; (2) expense of services; (3) preference to do their own financial planning;and (4) a sense of “getting along fine” without a written financial plan.


Financial Professionals Satisfaction1

Accountant/CPA 65

Attorney 62

CERTIFIED FINANCIAL PLANNER™ professional 61

Financial advisor 58

Stock broker 53

Insurance agent 46

Banker 45

Financial planner (not certified) 39

Another financial planner 16

Reasons Percent1

My financial affairs are not complicated (Q23-1) 42

Too expensive to engage a financial planner and develop a plan (Q23-2) 42

Do my own financial planning on an informal basis (Q23-5) 41

Get along fine without a financial plan (Q23-3 40

Many people claim to be financial planners, and it is hard to know who provides the bestplanning services (Q23-7)

30

Do not really know what is in a financial plan and how it benefits people (Q23-6) 24

Could not trust advice and recommendations of financial professionals (Q23-4) 20


33

Respondents with No Written Financial Plan

Table 8.4 Important reasons for not having a written financial plan by respondenteducation, household income, and investable assets (Q23 and 23-1through 23-4)

For the most part, reasons for not having a written financial plan do not vary across respondenteducation, income, and asset levels with the exception of those with investable assets in excess of$1 ML. These respondents are: (a) not likely to view their financial affairs as overly complicated; (2)not engaging a financial planner because of high perceived fees or expenses; (3) directly involvedin their own financial planning on an informal basis; and (4) feel that they “get along fine withouta written financial plan.”


Reasons1


<Highschool

Somecollege

College>

<$50K

$50K-$100K

$100K-$150K

$150K>

<$100K

$100K-$1ML

$1ML>

My financial affairs are not complicated 38% 44% 48% 41% 46% 45% 50% 44% 48% 58%

Too expensive to engage a financialplanner and develop a plan

41 46 42 42 49 33 35 47 36 21

Do my own financial planning on aninformal basis

37 47 45 49 45 51 50 42 50 63

Get along fine without a financial plan 37 41 43 39 41 22 50 40 48 63

Many people claim to be financialplanners, and it is hard to know whoprovides the best planning services

28 32 32 28 33 36 32 31 33 37

Do not really know what is in afinancial plan and how it benefitspeople

28 21 20 25 42 19 21 26 20 21

Could not trust advice and recommen-dations of financial professionals

19 23 18 20 21 21 9 19 22 42


34


Table 8.9 Preferences for compensation of financial professionals (Q25)

While 40% of respondents don’t know, most respondents with an opinion (30%) prefer tocompensate financial professionals through fees set at a flat or hourly rate.

1Data show percent of 1,122 respondents who selected each response category and, as a result, multiple responseswere permitted and column does not sum to 100%.





Don’t know 40


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Layout 1

Economy & Finance

national consumer survey

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personal nancial planning

personal finance table

consumer research

survey results

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