Journal of Financial Planning: December 2017
Frank Paré on Defining the Profession, Serving People First, and FPA’s Critical Roles
by Carly Schulaka
WHO: Frank Paré, CFP®
WHAT: Founder and president of PF Wealth Management Group; 2018 FPA president
WHAT'S ON HIS MIND: “We [FPA] have to be at the table in defining what financial planning is and is not.”
VIDEO INTERVIEW: Part 1
For 2018 FPA President Frank Paré, CFP®, the financial planners doing the work should have a say in defining financial planning. Part of that is volunteering to work with people from across the economic spectrum, some of whom have experienced financial planning as a life-saving tool.
Through pro bono efforts, Paré has found that planners have helped people go from the brink of financial catastrophe to starting their own businesses. This, Paré says, is key in helping to spread knowledge about the planning profession.
Paré recently sat down with the Journal to talk about his goals for the upcoming year, pro bono’s place in defining the profession, and FPA’s critical roles in advocating for and serving CFP® professionals.
VIDEO INTERVIEW: Part 2
1. How did you first get involved in FPA as a volunteer?
I became involved as a result of an FPA “Day on the Hill” invitation to visit our state capitol. It used to be our government relations efforts to provide free financial planning to staffers of our elected officials in Sacramento. And so, I thought what a great opportunity to advocate on behalf of FPA but also to volunteer and help our elected officials better understand financial planning.
I didn’t know what to expect. I basically was told to show up on a particular date and time, so I did. And that was the beginning. I had attended a couple of our chapter meetings but wasn’t really involved in terms of volunteering or serving on the board until that first day at the state capitol.
2. In your year as FPA president, what mark do you hope to leave on the association and on the profession?
I really want to emphasize how important the organization is to the success of our members. I want to continue to build upon the work of our previous leaders and what they’ve been able to do to get the organization to where it is today. I want to also embed the social impact that we’re having as planners within this profession. My hope is that I continue to leverage off what they’ve done and that we take bold steps into the future to make this truly a profession for our members and those who are contemplating becoming financial planners.
If I had to sum up my hopes as president for the year it would be: one, continue to position FPA’s role as the organization that elevates our members’ success. Two, advocate on behalf of our members’ futures by having a seat at the table when legislation that might impact our members is being discussed. And three, better communicate the “why” and the power of joining FPA more effectively. I think a lot of planners out there don’t know FPA, and I think we need to position our organization in such a way that they get to know us and come to rely on us as the go-to organization that’s going to help them achieve success as financial planning professionals.
Finally, I think FPA can also be a force for social impact in terms of supporting our members who are passionate about making a difference in their local communities through various pro bono initiatives.
3. You are passionate about pro bono planning and giving back to the community. Can you tell us about someone who has been impacted by pro bono financial planning?
Our profession is really interesting in that what we do is we try to get folks to take steps now that are going to impact their future—tiny steps that ultimately ripple throughout their lives. So, when we are helping individuals on a pro bono basis, it’s almost as if we are right there at a crosswalk with them, and as they are getting ready to step in front of a bus, we pull them back. In other words, we provide a crucial piece of information at the right time that helps prevent a bad situation from getting worse.
Here in Oakland [Calif.], a few years ago one of our FPA members, Michael Olff, CFP®, advised an individual who came to one of our Financial Planning Days events. She needed some assistance, so Michael helped out without giving a lot of thought to the impact he would have. The following year we learned she started a business and credited Michael for his advice. Many FPA members are touching the lives of individuals every day, and we don’t always see the transformation, but we know the potential impact.
4. How do you suggest FPA members get involved in pro bono efforts at their chapter or in their community?
Our [FPA national] board member Dick Power said something that was really powerful for me. Referring to another profession, he said, “They made a commitment to donate 1 percent of their time to pro bono; what if all of our members were to make that commitment?”
Now, Dick is a former FPA Pro Bono Advisory Committee chair. He has been working pro bono with military vets for a good portion of his career. And that statement alone highlights what it takes—sometimes it’s just taking a step back and making a commitment. If it’s an hour a week, let it be an hour a week. If it’s a day a week, let it be a day a week. Don’t let it become overwhelming to the point where you burn out. Start small.
The thing to note is, while we might recognize ourselves as a profession, the broader public doesn’t necessarily know or recognize the value of financial planning. If we collectively made a commitment to volunteer and share this incredible knowledge that can be impactful on the lives of everyday folk, then I believe it would go long way in helping to build this profession.
But we need more individuals to say, “I’m going to commit a little time to pro bono planning because this is bigger than me and it’s going to help build our profession.”
5. What role can FPA play to directly impact how the public views or understands financial planning?
We play a critical role. In many ways, we are the organization that embodies financial planning. We’ve embraced the CFP® marks—this is really our core. When we say one profession, one designation, we are in essence saying, if you’re going to be a financial planner, then you should be a CFP® professional. That’s essential. We are also members of the Financial Planning Coalition along with the CFP Board and National Association of Personal Financial Advisors.
We have to be at the table in defining what financial planning is and is not. I think our impact—whether it’s on advocacy, or pro bono—is to ensure when the public thinks of financial planning, they think of a CFP® professional and someone who is associated with FPA—an organization committed to making financial planners better. They shouldn’t rely on compensation models to drive their decision to work with an FPA member. Instead, they should focus on if the planning professional is competent in executing and applying relevant financial planning principles.
6. What do you feel is FPA’s role in passing on knowledge and wisdom from one generation of planners to the next?
As current leaders within FPA, we have an obligation and a duty to prepare the next generation of financial planners and leaders who will come after us—just as our NexGen leaders have an obligation to prepare for the generation that comes after them.
In terms of the knowledge and wisdom, one gains knowledge through study, but wisdom is gained through trial and error. We’re blessed in the sense that we still have a lot of women and men who were instrumental in getting us to where we are today as a profession. Despite the fact that I’ve been in the profession for 20-some odd years, I still look to some of these individuals as thought leaders to help me hopefully avoid making errors that they might have made in the past.
7. The name of your practice is PF Wealth Management Group. Tell us about the inspiration behind the initials PF.
The inspiration was—and I think I’m in a better space now—from a sense of frustration early in my career. I felt that I was more product-centric and not really spending time to listen to my clients’ stories. Rather than planning, I focused on a product as a solution without regard to how the product might fit within a holistic framework. In starting my practice, I wanted to listen more to the individual stories and really understand and get to the heart of what was important and of value to my clients. I also wanted to employ more holistic planning that was client-centric.
So, “People First,” or “PF” came out of this notion that it’s really about individuals and understanding what it is that they want to create, and then looking at the best solution based on the core financial planning areas to help them create the future they’re trying to create.
8. You started your own independent planning firm after leaving the corporate world. What advice do you have for planners looking to start their own practice?
The barrier to entry is really low, but the barrier for trust is tremendously high. I’m not going to sugarcoat it. It is not easy to convince people to talk about their fears or their past mistakes then give you their money to help them plan for the possibility of future rewards.
This is not one of those stories about overnight success where you obtain your CFP® marks then a year or two later you’re wildly successful. I think if individuals understand what the risks are and the fact that it does require some hard work; it does require some commitment; it does require a tremendous amount of passion—then I think they’re going to be positioning themselves for one of the greatest journeys ever.
But it should also be understood that being a financial planner and running a business requires different skill sets. Regardless of how well you might know financial planning, knowing how to run a business is crucial. Understanding that right off the bat will put people farther ahead than I was.
I believe that once you get to the point where you recognize the fact that you do have a real business and you’re really passionate about providing the best service to your clients—it is one of the best professions out there.
9. As a leader in financial planning, what is your hope for the future of the profession?
I really believe our profession—our members—are change agents. I really believe that if you are one who believes in acting in the best interest of your clients and having an ongoing duty of loyalty at all times, that you are in fact a change agent.
What’s important to note is individuals in this country and abroad need change agents to help them. I really believe that our profession is a true opportunity to help people better manage very difficult and confusing financial life stuff. Investment management, tax planning, cash flow, estate planning, insurance—all of that coming together—and then adding on top of that retirement, college, and other life challenges can be overwhelming and confusing.
We are in a unique situation in that we have the knowledge to weave all of the various financial components together to help people across economic lines—or at least we should be able to help everyone irrespective of their economic situation. My hope for the future is that we’re addressing that need; that we are truly helping people regardless of their economic situation on a much larger scale than we are today, and that when people hear “financial planning,” they know exactly what it is and what to expect.
10. How do we get there?
Passion and the belief we can. I think we get there by fostering our members’ success, advocating for their future, and communicating our “why” more effectively. In turn, our members will be able to help anyone and everyone who needs financial planning and is looking for an FPA member who is uniquely qualified to help them.
Carly Schulaka is editor of the Journal. Contact her HERE.