An Educational Trend for Advisors:
Aging Investors and New Designations
By John Churchill
January 18, 2006
As America ages, the need for advice on how to deal with the distribution of wealth becomes increasingly important. Picking up on that theme, a number of financial organizations have begun offering courses to better prepare advisors to help older investors with their financial affairs.
The courses offer the latest information on many financial topics relevant to older Americans, like providing for long-term care and estate planning, and they also teach students about the psychology of aging and other issues affecting older Americans. Students generally earn a designation after completing the course.
The American Institute of Financial Gerontology (AIFG), a partnership between the San Francisco-based American Society on Aging and Chester, Pa.-based Widener University, is typical of the organizations offering the courses. For the past three years, course-takers have learned to apply the study of aging and its biological, psychological and sociological impacts to the financial lives of older clients, says Neal Cutler, co-founder of AIFG and a professor of financial gerontology for 18 years at Widener. Those who complete the course become Registered Financial Gerontologists (RFG).
Don Haas, president of Haas Financial Services, an independent RIA in Southfield, Mich., is a RFG. When he first learned about the designation several years ago, he decided it would be useful for his mostly older clients -- even though as an older man, he's 75 years old now, he already knew a lot about what they needed. Still, he says the designation has been invaluable.
"It puts a lot of focus on understanding how people change as they age," Haas says. "The CFP covers the technical side of accumulating wealth, some about distributing it, but they don't get into what wraps around that."
Since entrants must have a background in financial advice, the focus of the RFG curriculum is more on issues related to the implications of aging on financial planning and caring for clients.
Entrants must take six four-hour courses, pass a two-hour exam and then agree to a code of ethics and a community-service requirement. Advisors learn the basics of the aging process, how to approach long-term care and how to maximize clients' financial longevity. They also learn to tackle issues like the financial and emotional implications of disorders and disease, as well as ethical and legal dilemmas like advanced directives and termination of treatment decisions.
The American College, the largest provider of the CFP designation, has been offering its Chartered Advisor for Senior Living (CASL) designation for just a little over a year. Over 1,100 advisors now have a CASL designation. Designed to be a kind of "CFP with a focus on seniors," the CASL is "a comprehensive designation for those who already advise seniors or want to advise seniors," says Nona Hillsberg, product manager for CASL at the American College.
It takes more than a year to complete the five-course curriculum, and advisors must pass a two-hour exam in each course. However, CFP holders can skip the courses on investments and estate planning. Like the RFG, the CASL has elements of gerontology, health and long-term care financing and deals with the strategies and complexities of distributing assets.
The Society of Certified Senior Advisors, a Denver-based organization founded 10 years ago by a group of "geriatric MDs, gerontologists, elder law attorneys, CPAs, financial planners" and others, also offers a course and designation. The Certified Senior Advisor (CSA) designation is usually attained in two months and is capped by a three-hour exam at completion. Participants learn the basics of aging as well as social and psychological implications. There is also a heavy dose of financial and estate planning and health and long-term care training.
For advisors with at least two years of experience, The Society of Certified Retirement Financial Advisors offers the Certified Retirement Financial Advisor (CRFA) designation. According to the Web site, the three-day program "is not only designed as an educational program but also contains marketing education and a marketing program to get you more affluent retired clients." Started in 2003 by Larry Klein, an investment advisor and former brokerage branch manager, the CRFA curriculum does not incorporate gerontology but focuses more on financial issues clients face in the distribution phase: how to liquidate assets with little or no capital gains, as well as training in estate planning and asset protection.
While some advisors voiced skepticism about the proliferation of "senior" designations, many also take it as a sign that the industry is maturing. "This is less about the evolution of the client, but of the industry," says Steve Gresham, executive vice president of the private client group of Phoenix Investment Partners in Hartford, Conn. "Finally, we're waking up to recognize the complexities of retirement and beyond."
Adds Barry Mendelson, managing partner of Capital Markets Consultants, a practice-management consulting firm: "When an advisor looks at his business and his clients, say they're older, he needs to know what skills he needs to stay on the cutting edge for them, whether it's one of these programs or something else."
From Registered Rep, a Prism Business Media Publication